Frequently Asked Questions

An ETF is a basket of securities that tracks & replicates an underlying index, commodity, or theme and trades on a stock exchange like a share. It combines the diversification of a mutual fund with real-time trading feature of a stock

Common categories of ETFs in India are Equity ETFs classified into Market Cap based ETFs, Thematic & Sectoral ETFs, Factor/Smart Beta ETFs), Fixed Income ETFs, Commodity ETFs and International ETFs. Each category offers exposure to a distinct asset class or strategy

ETFs are bought and sold through a demat and trading account on the stock exchange during market hours, just like shares. Orders are placed at live market prices via a broker or directly through an AMC

ETFs offer low-cost, transparent and diversified exposure to a market or theme in a single trade.

Few parameters to select an ETF are expense ratio, tracking error, liquidity (trading volume) and AUM. Lower tracking error and tighter bid-ask spreads indicate a better run, more efficient ETF.