Agarwal sees strong demand from global asset managers for launching India-focused passive products
Seven new passive funds (ETFs/Index Funds) tracking Nifty Indices launched in 2023 in Japan and South Korea have garnered about US$550 million worth of Assets under Management (AUM).
Six products are tracking Nifty 50 and 1 product is tracking Nifty50 2x leverage index.
The new products are:
Daiwa Asset Management of Japan tracks Nifty 50;
NZ Asset Management of Japan tracks Nifty 50;
au Asset Management of Japan tracks Nifty 50;
Sumitomo Mitsui Trust Asset Management of Japan tracks Nifty 50;
Mirae Asset Global Investments of South Korea tracks Nifty 50;
Samsung Asset Management of South Korea tracks Nifty 50
And Samsung Asset Management of South Korea tracks Nifty50 2x Leverage.
Presently, there are 21 Passive funds tracking Nifty Indices outside India. These products have been launched by large global asset managers including iShares Blackrock, DWS, First Trust, Nomura Asset Management, Mirae Asset Global Investments, Samsung Asset Management, Fubon Asset Management, Global X, Kiwoom Asset Management etc. In addition, there are 270 Passive funds tracking various Nifty Indices in India.
In the last 10 years, the total AUM of Passive Funds tracking Nifty Indices in India and outside India has increased to about US$70 billion in November 2023 from about US$1 billion in November 2013, growing at a staggering annualized rate of 53%.
“I would like to thank them for showing trust and confidence in the Indian Capital Markets. I would also like to extend my sincere gratitude to the Government of India and market regulator, Securities Exchange Board of India (SEBI), for enabling market friendly policies.
“With focused efforts of all the stakeholders and expected robust performance of the economy, we will surely progress towards achieving many more milestones in future.”
Mukesh Agarwal, MD & CEO, NSE Indices, elaborated, “We are seeing a strong demand from global asset managers for launching India-focused passive products. 2023 has been a historic year for NSE Indices with seven passive products launched outside India on Nifty indices during the year and they also garnered good AUM.
“We expect this trend to continue and many more India focused passive products are expected to be launched outside India in 2024 as well. We will continue to work with our clients to launch innovative India focused indices for launch of passive products.”
Many investment products based on Nifty indices have been developed within India and abroad. These include index-based derivatives traded on NSE and NSE International Exchange IFSC Limited (NSE IX) and a number of index funds and exchange traded funds. The flagship ‘Nifty 50’ index is widely tracked and traded as the benchmark for Indian Capital Markets. Fiinews.com
