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Best ETF For Long Term Investing ? What is an ETF ? [ETFs explained 2021] - YouTube
Channel: StockAdda with Janak
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By the end of this video im going to share the best ETF
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for long term in india
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if you would have invested in this ETF a year
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before then you would have earned a return of 79%
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the longterm investors (for 10 years) have earned
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more or less anualised average return in double digits
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which means that can consistantly beat the inflation
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if your portfolio is able to generate consistant retuns in double digit
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and as an investor this should be our prominent aim
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so lets get started
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ETF is an amazing option for passive investors
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if you are a business person, working professional
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or even a housewife, you wont be getting much time
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to track your stocks regularly
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and a passive investor is generally the one who is invested
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in one particular instument for a long perion of time
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which means that you don't need to track your ETF regularly
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the underlying asset classes of ETF are gold, debt but
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today we are going to track index ETFs
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means Sensex or Nifty, we wont be able to perchase all
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the stocks of these index, that is why we will indentify
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such ETFs which will replicate the returns of these indices
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and if you believe in India's growth stories that
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in days to come, Nifty and sensex are surely going to rise
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then ETFs are one of the best options that you can look at
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Infact ETFs are becoming so popular that investors are giving a
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dedicated allocation to ETFs in their portfolio
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that is why it is important for you to know abot ETF
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and you should definately keep ETF in your consideration
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there are few criterias to analyse ETFs same as stocks and mutualfunds
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it is important that ETFs have a consistance performs in past
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using there 2 parameters i have shared these 5 ETFs
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they are Nipon India ETF nifty BeR=ES, ICICI prudential nifty ETF
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HDFC nifty 50 ETF, LIC MF ETF- Nifty 50 and sensex ETFs
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these 5 ETFs have been there for more than 5 years in the market
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infact nipon India ETF has been there for more than 10 years
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that is why i have given 5 points to it and rest all 3 points
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here Nipon India ETF standsout
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the 2nd parameter for evaluating ETFs is its Fund size or AUM
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simply which means how popular is that ETF fund
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so if I plot the AUM of all these ETFs, AUM of nipon India ETF
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is 0f 3000 cr, ICICI prudential's AUM is of 2000 cr
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and the rest of the 3 have an AUM below 1000 cr
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so here i have given 5 points to Nifty BeES, 4 to ICICI prudential
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3 to HDFC Nifty 50 and 2 and 1 point to the remaining 2 respectively
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here as well Nifty BeES completely standouts
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the buying and selling of ETFs is on Sensex, ie. they are traded there
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one important you shold know is how muct is its trading volume
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what if you don't get any buyer or seller for your nifty etf
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so it very important to track the trading volume
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If i map the trading volumes of these 5 ETFs, so daily trading
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volume of Nipon India is around 30cr and that is why it gets 5 points
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ICICI prudential is hovering between 2-3 crs
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but it is quite volatile it goes on from lakhs to crores
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here there was lack of consistancy and so it gets 4 points
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HDFC has a trading volume of only 20 lakhs
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you need to keep this in mind and that is why it gets 3 points
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the trading volume of both the ETFs is 1 or 2 lakhs
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which is quite negligible and that is why it gets only 1 point
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here clearly with the perspective of fund size and trading volume
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Nipon India nifty BeES stands out
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ETFs are passive investments, which means someone else
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is managing it on your behalf, and this comes with its cost
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as an investor it is important for to check that is expense ratio is least
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so that you can earn a higher rate of return, so if we look at
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the expense ratio of all the 5 ETFs, Nipon, ICICI and HDFC's
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expense ratio is 0.05%, so here all 3 get 5 points
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both the ETFs of LIC have an expense ratio of 0.1%
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and that is why it gets 3 points, so here all the first 3 funds standout
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the 5th parameter to evaluate ETFs is tracking error
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tracking error is nothing but the difference between the returns of Index and EFT
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if we have a look at tickrtape website, Nipon fund has a close match
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there is some deviation in others but it is not quite major
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it is generally close to its underlying asset
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but I would give 1 point to Nipon India considering the benefit of doubt
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the rest all get no points, so here also Nipon India standsout marginally
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so let's talk about the results, but before there is a disclamer
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this analysis is neither a reccomendation nor an advise
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so please consult your financial advisor before taking any decision
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this video is only for educational purposes
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if you are interested in passive income investing
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then we have a video on top 3 dividend paying stocks, do have a look at it!
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Nipon India nifty BeES clearly standsout with 21 points
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ICICI prudential is 2nd with 16 points,
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HDFC nifty 50 ETF is 3rd with 14 points
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the last 2 are 4th and 5th respectively
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Here clearly Nipon India standsout in terms of trading volume, return, history,AUM
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You should keep a track of it if you are investing in ETFs
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See you till next Video !
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