'Cheonjeongbuji' India ETF Surpasses Vietnam as Well

60% Return Since Early Year 'No.1'

Ganges River, India / Photo by Getty Images Bank

[Asia Economy Reporter Hwang Junho] Exchange-traded funds (ETFs) investing in the Indian stock market have emerged as the top-performing ETFs in terms of year-to-date returns.

According to the Korea Exchange on the 6th, as of the 3rd, the ‘TIGER India Nifty 50 Leverage (Synthetic)’ ETF posted a 60.6% increase in returns compared to the beginning of the year. It overtook the ‘KINDEX Bloomberg Vietnam VN30 Futures Leverage (H, 55.95%)’, which had held the top spot for two months since May, to claim first place.

The India Nifty 50 Leverage ETF recorded a 23.04% return in just the past month, ranking first in monthly returns among domestic ETFs. As the Indian stock market soared, this product, which delivers twice the daily return of the underlying index, also saw a significant increase in returns. Although tracking a different index, the ‘KOSEF India Nifty 50 (Synthetic)’ ETF, which invests in the Nifty 50 market, also posted a 12.05% return.

Since the COVID-19 pandemic, individual participation in the stock market has increased, fueling the Indian market’s rise. According to the Securities and Exchange Board of India (SEBI), 10.7 million securities accounts were opened last year alone. The number of COVID-19 cases has also sharply declined. While daily cases reached up to 400,000 at the beginning of the year, they have recently dropped to around 40,000. The Indian Council of Medical Research (ICMR) reported that 62.3% of unvaccinated Indians already possess COVID-19 antibodies. Additionally, the Indian government announced plans to inject 100 trillion rupees (approximately 1570 trillion KRW) to overcome the economic impact of COVID-19, driving the stock market sharply upward.

Kim Hwan, a researcher at NH Investment & Securities, analyzed, "Emerging markets show divergent stock price trends by country. While the Korean stock market, facing concerns over having passed its economic peak and ongoing COVID-19 spread, has fallen sharply, the Indian stock market, where case numbers have peaked, is rising significantly."

An asset management industry official advised, "This product reflects not only twice the daily volatility of the Nifty 50 index but also twice the daily exchange rate fluctuations. Due to its much higher volatility, it can be considered suitable for short-term investment."