Benefits of investing in ETF funds in India
Following are the major benefits of investing in ETF stocks bullet Flexibility to trade:
1. Higher liquidity
You can trade ETFs just like individual stocks on prominent stock exchanges such as BSE and NSE. Thus, ETF provides you with good liquidity.
2. Low cost of investment
ETFs are listed on the stock exchanges and mostly have a lower expense ratio compared with that of other mutual funds. This makes ETFs a relatively cheaper investment option.
3. Easy structure
The structure of ETFs as an investment option is easy to understand.
4. Tax-efficient investment option
Generally, investment in ETFs tend to generate capital gains, which are much lower than other investment options largely because of low turnover of portfolio securities. This makes them a tax-efficient investment option.
5. Portfolio diversification
Exchange Traded Funds ETF Investment helps you diversify your overall investment portfolio. Thus, they help you spread your risks more effectively.