Know nifty 50 etf, best choice for first-time equity and direct stock investors – nifty50 etf best choice for first-time equity and direct stock investors
Here comes Nifty 50 ETF (Exchange Traded Funds). ETFs track a specific index and are traded on a stock exchange just like stocks. But it is offered by mutual fund companies. While trading in stock market you can buy and sell units of ETF on stock exchange. In this context, Nifty50 ETF can be a starting point for investors who are investing in the stock market for the first time.
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For such investors Nifty 50 ETF will also provide exposure in very small amounts. You can buy one unit of ETF for a few hundred rupees. For example, ICICI Prudential Nifty 50 ETF on NSE is trading at Rs. was trading at 185 In this way you can get Rs. 500 to 1000 can be invested and buy units of Nifty 50 ETF from the exchange. You can also make systematic investments every month. By doing this you will buy at all levels of the market and average your investment costs.
Millionaires made by mutual funds, 10,000 of an investor in ‘this’ fund became 1.8 crores
The Nifty 50 index includes the largest companies in the country in terms of market capitalisation. Hence, an investment in Nifty 50 ETF provides good diversification across stocks and sectors to the investor. A diversified portfolio reduces the investment risk of the investor. If you invest in a particular stock the risk is higher, while in the case of a diversified portfolio market volatility does not adversely affect all the stocks.
Investment returns in Nifty 50 ETF reflect the volatility of the Underlying Index. You need a demat account to invest in ETFs. Investors who do not have a demat account can consider investing in Nifty 50 index funds. Investing in Nifty 50 ETF is relatively cheap. Because the ETF tracks the Nifty 50 index indirectly and is underpriced.
