Investing in India – Fund Options
India is one of the world’s fastest growing economies, so it stand to reason that there should be some good investment opportunities there. How can investors outside of India participate? Stock-Net explores some viable fund options.
One thing to note from the start, there aren’t many mutual funds that focus exclusively on India. Eaton Vance Greater India fund, ETGIX, is one option, although it has a steep 2.35% expense ratio. Matthews India Fund, MINDX, invests at least 80% of its funds in India, carries a 2% expense ratio, and was up 6% last year and more than 20% over the past three years.
Two closed-end funds focus on India: Morgan Stanley India Investment Fund, IIF, and the India Fund, IFN. These funds have expense ratios of around 1.5%. Being closed-end, the funds may trade at either a premium or discount to NAV, so be aware of this before buying.
No ETF’s are currently available that focus exclusively on India, but Powershares is expected to announce one shortly. Be aware of the risks of investing in a fund focused exclusively on a single, emerging market country; the potential rewards may be great, but the risks are great also.
See the following chart for a comparison of fund options for India investing.
