Are you looking to invest in global securities? Did you know, mutual funds can also be your avenue to investing in international securities? Yes, there are international mutual funds available for investors to invest in. However, to invest in international securities, you can choose either thematic and sectoral mutual funds or international passive funds India.
Let us learn about internations passive funds India and top mutual funds in the category.
International Passive Funds India
Most international passive funds India fall in the Fund of Funds or FoF category. International passive funds offer a convenient way to access global markets without the complexities of direct investing. These funds track a specific international index, such as the NASDAQ, FANG, S&P 500 or MSCI World Index, providing exposure to a basket of foreign stocks and other securities (like gold and ETFs). By investing in these passive funds India, you can potentially enhance returns, reduce overall portfolio risk through diversification, and gain exposure to different currencies. International passive funds India can be particularly beneficial considering the potential for higher growth in certain international markets compared to the domestic market.
Investing in international passive funds India is straightforward. You can choose from a variety of fund houses offering FoFs tracking index funds or ETFs (Exchange Traded Funds) that track global indices. These funds are typically denominated in Indian Rupees (INR), making it easy to invest. However, it is important to consider factors like who is the fund manager, risk-o-metre profile, expense ratios, tracking error, and the underlying index’s composition before investing. Additionally, it is crucial to be aware of the tax implications and any potential currency risk associated with investing in foreign assets. So, it can be better to conduct thorough research, compare different funds, and align your investment choices with your financial goals and risk tolerance.
Top International Passive Funds India
Top FoFs in India as per 1 year returns
Here are the top ten international FoFs passive funds India based on one year return period:
| Fund Names | TER | 1 Year Returns |
|---|---|---|
| Edelweiss US Technology Equity FoF Growth Direct Plan | 1.41% | 52.90% |
| Bandhan US Equity FoF Growth Direct Plan | 0.65% | 48.40% |
| DSP Global Innovation FoF Growth Direct Plan | 1.16% | 45.60% |
| Kotak Nasdaq 100 FoF Growth Direct Plan | 0.3% | 45.10% |
| DSP World Gold FoF Growth Direct Plan | 1.65% | 43.90% |
| Axis Nasdaq 100 FoF Growth Direct Plan | 0.24% | 40.00% |
| Navi Nasdaq 100 FoF Growth Direct Plan | 0.15% | 39.70% |
| Kotak Global Innovation FoF Growth Direct Plan | 0.45% | 37.70% |
| Axis Global Innovation FoF Growth Direct Plan | 0.75% | 37.70% |
| Kotak International Reit FoF Growth Direct Plan | 0.53% | 26.20% |
The above table reveals a diverse range of international Fund of Funds (FoFs) available to Indian investors. Many focus on Nasdaq-based funds, offering exposure to US technology giants. Beyond that, you will find options investing in commodities, the broader US equity market, and thematic funds capturing trends like technology, growth, and innovation. For those seeking real estate exposure, there are even FoFs specialising in international REITs. Performance varies significantly, with one-year returns spanning a wide range – from over 50% to under 30%.
Top FoFs in India as per 3 year returns
Let us now look at top FoF passive funds India based on three year returns. Here is the table for the same.
| Fund Names | TER | 3 Year Returns |
|---|---|---|
| Mirae Asset NYSE FANG ETF FoF Growth Direct Plan | 0.71% | 19.60% |
| Kotak Nasdaq 100 FoF Growth Direct Plan | 0.30% | 13.78% |
| Invesco India Invesco Global Equity Income FoF Growth Direct Plan | 0.86% | 13.40% |
| Bandhan US Equity FoF Growth Direct Plan | 0.65% | 13.12% |
| Motilal Oswal Nasdaq 100 FoF Growth Direct Plan | 0.24% | 12.80% |
| SBI International Access US Equity FoF Growth Direct Plan | 0.90% | 12.00% |
| HDFC Developed World Indexes FoF Growth Direct Plan | 0.23% | 10.40% |
| DSP US Flexible Equity FoF Growth Direct Plan | 1.49% | 10.40% |
| DSP World Gold FoF Growth Direct Plan | 1.65% | 9.83% |
| Axis Global Equity Alpha FoF Growth Direct Plan | 0.84% | 9.60% |
Analysing the top-performing international FoFs in India with three years returns reveals a clear trend—mostly funds are focussing on global equities. Many invest in funds tracking major indices like the Nasdaq and NYSE FANG, providing broad exposure to international stock markets. Others diversify across multiple indices, offering a more balanced approach. Interestingly, some international FoFs are tapping into commodities, with gold being a prominent focus.
Benefits Of Investing In International Passive Funds India
While both international passive funds and direct investment in international securities offer exposure to global markets, there are key differences to consider:
Diversification and Risk Reduction
- International Passive Funds India: Offer instant diversification by tracking an index of multiple securities. This reduces risk by spreading investments across various companies and sectors.
- Direct Investment: Requires individual security selection, potentially concentrating risk if not diversified adequately. Building a diversified portfolio directly can be time-consuming and complex.
Cost-Effective and Convenient Access
- International Passive Funds India: Generally have lower expense ratios than actively managed funds and often involve simpler transaction processes.
- Direct Investment: Can involve higher transaction costs, including brokerage fees, currency conversion charges, and potentially higher taxes. May also require navigating different trading platforms and regulations.
Currency Hedging and Safeguard
- International Passive Funds India: May offer some level of currency hedging depending on the fund strategy.
- Direct Investment: Exposes investors directly to currency risk, requiring separate hedging strategies if desired.
Ease of Investment
- International Passive Funds India: Simple to invest in through Indian brokers and platforms, often with INR denominations.
- Direct Investment: May require opening overseas trading accounts and navigating different regulatory environments.
Wrapping Up
Investing in international passive funds India or global passive funds India can offer you a gateway to investing in international securities in a convenient, cost-friendly and systematic manner. You can check the Kuvera app for different international passive funds India and their features such as underlying asset classes, fund manager, TER, risk profile, AUM, NAV and more. Check the funds now, compare and start investing with the Kuvera platform.
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