NFO launch | DSP Investment Managers announces Nifty Bank ETF — Key things to know

Historical data since 2000 shows that Nifty Bank Index has outperformed the broad Nifty 50 index in 15 out of 23 years. On a 10-year basis, Nifty Bank Index has outperformed Nifty 50 Index a whopping 98 percent of times. However, investors should note some risks arising from concentration risk arising from the index having exposure only to 12 stocks in the banking sector and the possibility of higher volatility and drawdown as compared to a diversified equity fund which can result in comparative short-term underperformance.

“A banking system functions as the heart and lifeblood of any functioning economy. A robust banking system is the key to economic growth and development, especially for a fast-growing country like India. The banking sector is expected to see further value unlocking due to the fundamentals factors and that coupled with attractive valuations presents an attractive opportunity for investors. We would advise investors to consider this product with a long-term orientation as evidenced by the long-term performance of the Nifty Bank Index.” said Anil Ghelani, CFA, Head – Passive Investments & Products, DSP Investment Managers.