BetaShares announced it will launch a new ETF to give investors access to companies in one of the fastest growing economies in the world via the ASX.
The BetaShares India Quality ETF will invest directly in a diversified portfolio of high quality Indian companies.
India is one of the fastest growing economies in the world, with GDP projections of ~7% annually to 2023. India already has a significant footprint in the IT sector and is home to companies including Tata Group and Infosys.
BetaShares chief executive Alex Vynokur said: "India is one of the fastest growing, and most exciting, global economies. Our India ETF will give investors a great way to access this fascinating market, with a carefully screened portfolio of high quality Indian companies."
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Following research, BetaShares decided to utilise a quality-focused index for the India ETF. It noted companies that demonstrate superior quality characteristics have historically exhibited reduced declines during market falls.
"India is a substantially less efficient market than those in the developed world, which provides the opportunity for significant outperformance in returns compared to a pure market capitalisation index approach," said Vynokur.
"Our methodology provides investors with the return potential that comes from a focus on quality companies, along with the cost-efficiency and transparency that is available from a passive indexing approach."
He added that BetaShares' approach to the quality-focussed India ETF will reduce the potential for a small number of companies to dominate returns.
Vynokur explained reducing that potential is especially relevant in this situation, because the Indian stock market is one of the most concentrated stock markets in the world.
"We expect strong interest from our clients in the BetaShares India Quality ETF as a part of their international equities portfolio." Vynokur said.