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Index Traded Fund – Nifty BeEs

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There are multiple methods and modes of investment in stock markets. Traditionally, it was directly by purchasing and selling stocks at the stock exchanges. Then came mutual funds and they had been very popular among investing community. Investors loved the mutual fund because of the ease it offered in terms of the security, consistent returns and relief from tracking the stock markets and individual stocks.

Mutual funds are one of the finest ways to enter equity market for an average investor.  They reduce the entire workload and stress of picking up the right stocks at right time. One new instrument of investing in stock market which is now picking up and is extremely popular among new and veteran investors is ETF. ETF stands for Exchange Traded Fund and they are index traded funds.

They are traded on stock market like any equity stock but posses the features of a mutual fund. They are managed by a fund manager who looks after its portfolio and its management. One of the most popular ETFs in Indian market is Nifty BeES.

Nifty BeES stands for Nifty Benchmark Exchange Traded Fund. It was launched in December 2001 and it is managed by Vishal Jain. It belongs to Benchmark Mutual Fund and it is the largest fund house in India for Exchange Trade Funds.  Nifty BeES is listed on National Stock Exchange and its objective is to provide returns which correspond to returns generated by Nifty.

As per the feb end, the asset under management for this fund stood at Rs 622 crore and has a CRISIL ranking of 1. It is one of the best performing ETF in India and had provided consistent return. It is an excellent tool for someone who is looking to invest in Indian equity market. Investors should note that there could be some additional charges for ETFs.

The impact cost of Nifty BeES is 0.11 as of Feb 2011. Nifty BeES is a diversified Exchange Traded Fund which contains Top 50 Nifty stocks which belongs to 23 different sectors. The biggest contribution comes from the sectors like banks, petroleum products and software which contribute around 39 per cent of the total portfolio. It is one of the finest ETF and exceptionally good tool to target large cap companies.

There are few more index traded funds in India and they have consistently performed well. They provide the ease of trading at the stock market which can be done online or offline like conventional trading of stocks.

 

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About akhilendra

Hi, I’m Akhilendra and I write about Business Analysis, Data Science, IT & Web. Join me on Twitter, Facebook & Google+

Comments

  1. Not all the time no one can win the match of stock market trade , humans are bounded with emotions and personal affairs that makes them to take wrong decisions at right time even though they are masters of trade. Markets dramatically change they their flow and no one exactly produce or expect 100% from their profits . Choosing the right indicator or analyzing software blended with human aspect gives better results.

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  2. Thank you for sharing. Not to many people in your position are so gracious. Your article was very poignant and understandable. It helped me to understand very clearly. Thank you for your help.
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