Exchange-traded funds (ETFs) are rapidly becoming a popular investment choice in India. These funds offer a cost-effective, diversified, and transparent way to invest across various sectors and asset classes. As more investors explore ETFs to enhance their portfolio returns, understanding the top 5 ETFs in India attracting investors can help you make informed investment decisions.
ETFs in India track indices, commodities, or sectors, allowing investors to gain exposure to the broader market or specific investment themes. Whether you’re a beginner or a seasoned investor, the top 5 ETFs in India attracting investors in 2025 are worth exploring. In this post, we’ll analyze the features, benefits, and performance of these ETFs while highlighting their role in a diversified portfolio.
Why Are ETFs Gaining Popularity in India?
The ETF market in India has seen remarkable growth over the last few years. Here’s why ETFs are attracting investors:
- Low Cost: ETFs generally have lower expense ratios compared to actively managed mutual funds.
- Diversification: By investing in an ETF, you get exposure to a basket of securities instead of just one.
- Liquidity: ETFs are traded on stock exchanges, making it easy to buy and sell during market hours.
- Transparency: Since ETFs track an index, their holdings are transparent and predictable.
- Ease of Investment: ETFs allow both retail and institutional investors to participate in the market.
As India’s financial markets mature, ETFs are becoming an essential part of investment portfolios, attracting a wide range of investors.
Top 5 ETFs in India Attracting Investors
Below are the top 5 ETFs in India attracting investors in 2025, based on their performance, popularity, and potential for growth:
1. Nippon India ETF Nifty 50
The Nippon India ETF Nifty 50 tracks the Nifty 50 Index, one of India’s most prominent benchmarks. This ETF provides exposure to the top 50 companies listed on the NSE, making it a great choice for investors seeking broad market exposure.
| Key Features | Details |
|---|---|
| Expense Ratio | 0.05% |
| AUM (Assets Under Management) | ₹24,000 crore (approx.) |
| Dividend Yield | ~1.4% |
| Top Holdings | Reliance Industries, HDFC Bank, TCS |
Why Invest in Nippon India ETF Nifty 50?
- Market Leaders: Gain exposure to India’s top-performing blue-chip companies.
- Low Cost: Among the most cost-efficient ETFs available in India.
- Stability: Ideal for long-term investors seeking consistent returns.
For more details, visit the Nippon India ETF Nifty 50 page.
2. ICICI Prudential Sensex ETF
The ICICI Prudential Sensex ETF tracks the S&P BSE Sensex, which consists of 30 of India’s largest and most liquid companies. This ETF is popular among investors looking for stable and reliable market exposure.
| Key Features | Details |
|---|---|
| Expense Ratio | 0.07% |
| AUM | ₹15,000 crore (approx.) |
| Dividend Yield | ~1.2% |
| Top Holdings | Infosys, HDFC Bank, ITC |
Why Invest in ICICI Prudential Sensex ETF?
- Blue-Chip Exposure: Includes well-established companies with a track record of performance.
- Long-Term Growth: The Sensex is one of the most trusted indices in India.
- Low Volatility: Suitable for investors looking to balance risk and return.
3. SBI ETF Nifty Bank
The SBI ETF Nifty Bank focuses on the Nifty Bank Index, which comprises the top banking stocks in India. This ETF is a great choice for those looking to invest in the fast-growing banking sector.
| Key Features | Details |
|---|---|
| Expense Ratio | 0.30% |
| AUM | ₹12,000 crore (approx.) |
| Top Holdings | HDFC Bank, ICICI Bank, Kotak Mahindra Bank |
Why Invest in SBI ETF Nifty Bank?
- Sector-Specific Growth: Banking is a crucial driver of India’s economic growth.
- High Liquidity: Banking stocks are among the most traded on Indian exchanges.
- Performance Potential: Historically, the Nifty Bank Index has outperformed broader indices.
For more details, visit the SBI ETF Nifty Bank page.
4. UTI Gold ETF
The UTI Gold ETF tracks the price of physical gold. For investors seeking a hedge against inflation or economic uncertainty, this ETF is an attractive option.
| Key Features | Details |
|---|---|
| Expense Ratio | 0.80% |
| AUM | ₹5,000 crore (approx.) |
| Asset Backing | Physical gold (99.5% purity) |
Why Invest in UTI Gold ETF?
- Hedge Against Inflation: Gold is considered a safe-haven asset in uncertain times.
- Portfolio Diversification: Adds an alternative asset class to your portfolio.
- Ease of Trading: Provides exposure to gold without the need to hold physical gold.
5. Motilal Oswal Nasdaq 100 ETF
The Motilal Oswal Nasdaq 100 ETF tracks the Nasdaq-100 Index, providing exposure to top U.S.-based tech companies like Apple, Microsoft, and Amazon. This ETF is popular among Indian investors looking to diversify globally.
| Key Features | Details |
|---|---|
| Expense Ratio | 0.50% |
| AUM | ₹7,000 crore (approx.) |
| Top Holdings | Apple, Microsoft, NVIDIA |
Why Invest in Motilal Oswal Nasdaq 100 ETF?
- Global Diversification: Gain exposure to leading global technology companies.
- High Growth Potential: The tech sector has delivered strong returns over the past decade.
- Currency Advantage: Benefit from INR depreciation against the USD.
For more details, visit the Motilal Oswal Nasdaq 100 ETF page.
Comparison Table: Top 5 ETFs in India Attracting Investors
| ETF Name | Index Tracked | Expense Ratio | AUM (₹ Crore) | Key Sector |
|---|---|---|---|---|
| Nippon India ETF Nifty 50 | Nifty 50 | 0.05% | 24,000 | Broad Market |
| ICICI Prudential Sensex ETF | S&P BSE Sensex | 0.07% | 15,000 | Broad Market |
| SBI ETF Nifty Bank | Nifty Bank | 0.30% | 12,000 | Banking |
| UTI Gold ETF | Gold Prices | 0.80% | 5,000 | Gold |
| Motilal Oswal Nasdaq 100 ETF | Nasdaq-100 | 0.50% | 7,000 | Global Technology |
How to Choose the Right ETF for Your Portfolio?
Selecting the right ETF depends on your investment goals, risk appetite, and time horizon. Here’s a guide to help you decide:
- For Broad Market Exposure: Choose Nippon India ETF Nifty 50 or ICICI Prudential Sensex ETF.
- For Sector-Specific Growth: Opt for SBI ETF Nifty Bank.
- For Hedging Against Inflation: Consider UTI Gold ETF.
- For Global Diversification: Invest in Motilal Oswal Nasdaq 100 ETF.
Why ETFs Are a Game-Changer for Indian Investors
The rise of ETFs in India has democratized investing, enabling even small investors to participate in the financial markets. Here’s why ETFs are a game-changer:
- Accessibility: With affordable pricing, ETFs are accessible to retail investors.
- Transparency: Investors can easily track the performance of their ETFs.
- Flexibility: ETFs can be used for both short-term trading and long-term investing.
Conclusion: Top 5 ETFs in India Attracting Investors
The top 5 ETFs in India attracting investors—Nippon India ETF Nifty 50, ICICI Prudential Sensex ETF, SBI ETF Nifty Bank, UTI Gold ETF, and Motilal Oswal Nasdaq 100 ETF—offer a mix of broad market exposure, sector-specific growth, and global diversification. By adding these ETFs to your portfolio, you can achieve long-term growth, stability, and risk-adjusted returns.
Before investing, consider your financial goals and consult with a financial advisor to ensure these ETFs align with your overall strategy. For more insights, check out our Beginner’s Guide to ETFs.
Happy Investing!
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