5 Best Global ETFs to Buy for Long Term in India
Investing in Global ETFs (Exchange Traded Funds) has emerged as a smart strategy for Indian investors seeking diversification, long-term growth, and exposure to international markets. With the Indian stock market being limited in sector diversity, global ETFs allow investors to tap into the growth of foreign economies, tech giants, and emerging sectors across the world. In this article, we will explore the 5 best global ETFs to buy for long-term investment in India, their features, pros & cons, and how they compare to each other.
What is a Global ETF?
A Global ETF is a type of exchange-traded fund that invests in international stocks, indices, or sectors outside India. These ETFs are listed on Indian stock exchanges or accessible via international brokerage accounts. Global ETFs are designed for investors looking for:
- Diversification: Reduce concentration risk by investing across countries and sectors.
- Growth Potential: Participate in high-growth international markets like the US, China, and Europe.
- Hedge Against Domestic Risk: Mitigate risks linked to Indian market volatility or economic slowdown.
Why Invest in Global ETFs for the Long Term?
Long-term investment in global ETFs has several advantages:
- Capital Appreciation: Benefit from growing global companies like Apple, Microsoft, Tesla, and Alibaba.
- Currency Diversification: Exposure to foreign currencies can reduce risk from INR fluctuations.
- Sectoral Growth: Access to sectors underrepresented in India, like global tech, healthcare, and renewable energy.
- Passive Investing: ETFs are usually passively managed and track global indices, reducing the need for constant monitoring.
Top 5 Global ETFs to Buy for Long-Term in India
Hereโs a detailed breakdown of the 5 best global ETFs suitable for Indian investors:
1. Motilal Oswal Nasdaq 100 ETF
Description:
This ETF tracks the NASDAQ-100 Index, offering exposure to US tech giants such as Apple, Microsoft, Amazon, and Google. Ideal for tech-focused investors, it has shown consistent growth over the past decade.
Features Table:
| Feature | Details |
|---|---|
| Index Tracked | NASDAQ-100 |
| Expense Ratio | 0.70% |
| AUM | โน2,500 Crore |
| Returns (5Y) | 18-20% CAGR |
| Risk Level | Medium-High |
Pros:
- Exposure to world-leading tech companies.
- High long-term growth potential.
- Listed on NSE and BSE, easy to invest.
Cons:
- Highly tech-focused; less diversified sector-wise.
- Sensitive to US market volatility.
2. ICICI Prudential US Bluechip Equity Fund ETF
Description:
This ETF invests in top US bluechip companies, providing stability and growth potential. Itโs suitable for risk-averse investors looking for quality and long-term capital appreciation.
Features Table:
| Feature | Details |
|---|---|
| Index Tracked | S&P 500 |
| Expense Ratio | 0.75% |
| AUM | โน1,800 Crore |
| Returns (5Y) | 15-17% CAGR |
| Risk Level | Medium |
Pros:
- Diversified across 500 US companies.
- Stable returns with moderate risk.
- Lower volatility than tech-focused ETFs.
Cons:
- Moderate growth compared to high-tech ETFs.
- Currency fluctuations can impact returns.
3. Motilal Oswal Global India Feeder ETF
Description:
Unlike other global ETFs, this one provides exposure to Indian companies listed internationally or Indian-themed global funds, allowing investors to combine global exposure with domestic familiarity.
Features Table:
| Feature | Details |
|---|---|
| Index Tracked | MSCI India Global Index |
| Expense Ratio | 0.80% |
| AUM | โน1,200 Crore |
| Returns (5Y) | 12-15% CAGR |
| Risk Level | Medium |
Pros:
- Mix of domestic and global growth.
- Reduces foreign market dependency.
- Good long-term growth potential.
Cons:
- Limited global diversification.
- Moderate returns compared to pure US/China ETFs.
4. Nippon India ETF Hang Seng BeES
Description:
This ETF tracks the Hang Seng Index, representing the Hong Kong market. Itโs ideal for investors seeking exposure to Asian markets and Chinese tech/financial sectors.
Features Table:
| Feature | Details |
|---|---|
| Index Tracked | Hang Seng Index |
| Expense Ratio | 0.85% |
| AUM | โน900 Crore |
| Returns (5Y) | 10-13% CAGR |
| Risk Level | Medium-High |
Pros:
- Access to emerging Asian markets.
- Diversification beyond US markets.
- Focus on growth sectors in China and Hong Kong.
Cons:
- Political and regulatory risks in China/Hong Kong.
- Slightly higher expense ratio.
5. Franklin India Feeder โ Franklin U.S. Opportunities Fund
Description:
This is a feeder fund investing in the US stock market with an active strategy, focusing on growth companies and high-performing sectors.
Features Table:
| Feature | Details |
|---|---|
| Fund Type | Feeder Fund |
| Expense Ratio | 1.0% |
| AUM | โน1,500 Crore |
| Returns (5Y) | 16-18% CAGR |
| Risk Level | Medium-High |
Pros:
- Active management can capture high-growth opportunities.
- Exposure to leading US companies.
- Suitable for long-term investors with moderate risk appetite.
Cons:
- Higher expense ratio.
- Returns may vary due to active management.
Global ETFs Comparison Table
| ETF Name | Index Tracked | Expense Ratio | 5Y Returns | Risk Level |
|---|---|---|---|---|
| Motilal Oswal Nasdaq 100 ETF | NASDAQ-100 | 0.70% | 18-20% | Medium-High |
| ICICI Prudential US Bluechip ETF | S&P 500 | 0.75% | 15-17% | Medium |
| Motilal Oswal Global India Feeder ETF | MSCI India Global Index | 0.80% | 12-15% | Medium |
| Nippon India ETF Hang Seng BeES | Hang Seng Index | 0.85% | 10-13% | Medium-High |
| Franklin India Feeder โ US Opportunities | US Growth Stocks | 1.0% | 16-18% | Medium-High |
How to Invest in Global ETFs in India
- Open a demat account with NSE/BSE access.
- Choose a broker offering global ETFs.
- Decide on the amount to invest based on risk appetite.
- Use SIP or lump sum investment methods.
- Monitor quarterly performance and stay invested long-term.
Pros & Cons of Investing in Global ETFs
Pros:
- Diversified international exposure.
- Long-term growth potential.
- Hedge against domestic market volatility.
- Easy to buy/sell via Indian exchanges.
Cons:
- Currency fluctuation risks.
- Political/economic risks in foreign markets.
- Returns may be impacted by global events.
FAQs on Global ETFs
1. Can NRIs invest in Indian-listed global ETFs?
Yes, Non-Resident Indians can invest through demat accounts but must follow FEMA regulations.
2. What is the ideal holding period for global ETFs?
Minimum 5-7 years is recommended to benefit from compounding and reduce volatility impact.
3. Are global ETFs riskier than Indian ETFs?
They are moderately riskier due to currency fluctuations and foreign market exposure. Diversification can reduce overall risk.
4. Can I invest via SIP?
Yes, many Indian brokers allow SIP investments in global ETFs.
5. Do global ETFs pay dividends?
Most ETFs reinvest profits; some may pay dividends quarterly or annually depending on fund policy.
Conclusion
Global ETFs offer Indian investors a powerful tool for long-term wealth creation by providing access to international markets, high-growth sectors, and diversification beyond domestic boundaries. Among the top five, the Motilal Oswal Nasdaq 100 ETF and ICICI Prudential US Bluechip ETF stand out for tech and bluechip exposure, while Nippon India Hang Seng BeES and Motilal Oswal Global India Feeder ETF diversify into Asian markets and Indian global opportunities. Understanding the features, risks, and long-term potential is key to making the right investment choice.
Long-term investing in these ETFs not only provides portfolio diversification but also ensures participation in global economic growth, making them essential for any serious Indian investor.
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