What is an ETF, and how is it different from an index fund?

An ETF, or Exchange Traded Fund, is a fund whose units are listed and traded on the stock exchange like a share. Both an ETF and an index fund track an index passively, but they are bought differently: with an index fund you transact with the fund house at the day's NAV, whereas with an ETF you buy and sell units on the exchange during market hours at prevailing prices, using a demat and trading account.

How does the fund decide what to hold?

The fund is passively managed. Rather than a fund manager selecting stocks, it aims to hold the same securities as the FTSE India Equity Index (TRI), in broadly the same proportion. When the index is reviewed and rebalanced, the fund adjusts its holdings to stay aligned. Its returns are therefore designed to track the index, with subject only to tracking error known as tracking error.

Is there an exit load?

No. The fund does not charge an entry or exit load. Once listed, however, buying and selling ETF units on the exchange may involve brokerage and other transaction costs charged by the broker or the exchange.

How risky is this fund?

As an equity fund that tracks a broad market index, its value moves up and down with the Indian stock market, so returns can be volatile over shorter periods. Being passive, it mirrors the make-up and movements of its underlying index and does not try to cushion market falls through active decisions; its returns can also differ slightly from the index because of tracking error. It is best suited to investors with a long investment horizon who are comfortable with equity market ups and downs.

HDFC FTSE India Equity ETF

Q: What does HDFC FTSE India Equity ETF invest in?

The fund invests in the securities that make up the FTSE India Equity Index (TRI), which covers close to 90% of the market capitalisation of the FTSE India All Cap Index. At least 95% of the fund's assets are held in these index securities, with up to 5% in cash or cash equivalents for liquidity.

ETF

About HDFC FTSE India Equity ETF

HDFC FTSE India Equity ETF is an open-ended Exchange Traded Fund (ETF) that tracks the FTSE India Equity Index (TRI). It aims to deliver returns that correspond to the performance of this index, before fees and expenses and subject to tracking error, by holding the same securities in broadly the same proportion as the index.

The index it follows offers broad, diversified exposure to Indian equities, covering roughly 90% of the market capitalisation of the FTSE India All Cap Index

A few features of the index worth noting:

It spans a large, variable set of constituents drawn from across India's listed market
Weights are based on free-float market capitalisation and foreign ownership limits, with 25% capping at the stock level and 65% capping on aggregate weight of top 3 constituents. The capping is conducted quarterly and the index is reviewed semi-annually

Because the fund replicates this index, it holds at least 95% of its assets in the index's securities, with the balance in cash or cash equivalents or liquidity. It is benchmarked against the FTSE India Equity Index (TRI).

What is HDFC FTSE India Equity ETF

This is a fund that lets you invest in a broad basket of Indian company shares in one go, mirroring a market index rather than relying on a manager to pick individual stocks.

It combines two ideas. As an Exchange Traded Fund, it is passively managed: instead of a fund manager deciding what to buy and sell, it aims to hold the same securities as the index it tracks, so its returns move in line with that index, subject only to tracking error. Its units are listed and traded on the stock exchange like a share, which means that after the New Fund Offer once the scheme reopens you buy and sell units through the exchange and need a demat and trading account to do so. The units can be bought and sold on the exchange during market hours with a minimum investment of Rs 500.

Who can consider HDFC FTSE India Equity ETF

This fund may suit investors who:

Are seeking diversification across multiple stocks and sectors Are comfortable with a passive, index-tracking approach rather than active stock selection.
Are seeking long-term capital appreciation and can stay invested through market cycles, typically five years or more.

Returns

Inception Date

12/10/2026

Riskometer

Very High

Min SIP

₹ 100

Ideal for

Entry Load

An entry load is a fee charged to investors when they purchase units of a Mutual Fund scheme. This fee was used to cover distribution and marketing expenses incurred by the Asset Management Company (AMC). Currently, Mutual Funds in India do not levy entry loads.

TER

Lock in

A lock-in period is the fixed duration during which investors cannot sell or redeem their investments/Mutual Fund units. For example, Equity Linked Savings Schemes (ELSS) Funds have a 3-year lock-in.

iNAV NA

Net Asset Value (NAV) per unit is the total market value of securities of a scheme minus liabilities divided by the total number of outstanding units on a given date.

AUM (12/09/2026)

Assets Under Management (AUM) is the total market value of all assets that a Mutual Fund manages on behalf of its investors.

₹0.00 Cr.

Benchmark

A benchmark is a standard market index used to compare a Fund’s performance. It helps investors know whether the Fund is performing better, worse, or similar to the market.

FTSE India Equity In...

FTSE India Equity Index (TRI)