As per Association of Mutual Funds of India (AMFI) data, six ETFs have given over 80 per cent returns. Among them, three are ETFs focused on Public sector banks. ETFs Exchange-traded funds (ETFs) are passively managed mutual funds that are traded like stocks. Simply put, ETFs are mutual funds that track a benchmark index's performance but trade on the stock exchange like individual stocks. For instance, investors can choose ETFs based on the BSE 500 index, representing India's largest companies or opt for specific thematic ETFs like ETFs on gold, banks, automobiles or healthcare. But since they are traded on the stock exchange, to invest in ETFs, one must have a Demat account, or you can invest in ETFs through the fund-of-fund route.
Also one cannot invest in ETFs via SIPs but there is no minimum investment and you can just buy one share of ETF. When we take top performers most of them are investing majorly in energy stocks and PSU bank stocks. Here are the top ETFs that have generated the maximum returns in the past year.
The CPSE ETF emerges at the top spot, boasting a whopping 108.30 per cent return over the past year. It mainly invests in securities as represented by the CPSE Index, which are government companies such as NTPC, Power Grid, Coal India etc. With the consistent performance of 55.9 per cent and 26.19 per cent returns over three and five years, respectively, it has garnered a lot of investor attention. In this list, CPSE ETF holds the highest daily AUM of Rs. 39,720.33 crore.
Motilal Oswal S&P BSE Enhanced Value ETF with 97.26 per cent returns in the last year grabs the second spot. This ETF invests in 30 stocks following a value or contrarian style of investing, by finding stocks that are underpriced than their true worth.
Holding a modest AUM of Rs 63.22 crore the fund has majorly invested in banks and energy stocks like Hindalco India, Grasim, ONGC and SBI.
The Kotak Nifty Alpha 50 ETF boasts an impressive 82.39 per cent over the past year. An ETF which is 2 years and 4 months old holds a daily AUM of Rs 123.01 crore. As the name suggests it tries to find stocks with alpha potential, this ETF currently invests around 53 per cent in large caps and 46 per cent in mid-cap companies.
Riding the PSU Wave that happened in 2023, this ETF invests in shares of banks and financial services companies and has garnered 82.03 per cent returns. NIFTY PSU Bank Total Return Index underlying this ETF has given around 50 and 19 per cent in 3 and 5 years respectively.
Kotak Nifty PSU Bank ETF with 81.63 per cent and Nippon India ETF Nifty PSU Bank with 81.52 per cent in one year are in close fifth and sixth position among ETFs.
Since there are three funds from the PSU Bank ETF category, we have chosen the next best performer for the fifth position skipping PSU Bank ETFs. With a daily AUM of Rs 59.66 crore, this ETF invests in the automobile sector with 72.02 per cent returns.
