Top 10 ETF Funds in India | Trendy Traders

Introduction

If you’ve ever wondered how to diversify your investments without the stress of picking individual stocks, Exchange Traded Funds (ETFs) might just be your answer. Think of ETFs like a ready-made thali at your favorite restaurant—you get a balanced mix of everything without having to order each dish separately. With ETFs, you invest in a basket of securities, giving you diversification, lower risk, and cost efficiency in one simple product.

In India, ETFs are becoming one of the most popular investment choices for both beginners and experienced investors. But with so many options available, the big question is: Which are the top 10 ETF funds in India, and which is the best ETF to invest in right now?

Let’s break it all down in a simple, conversational way so you can make smarter financial decisions with confidence.

Discover the top 10 ETF funds in India. Find the best ETF in India and the best ETF to invest for 2025. Explore safe, smart, and trending ETF options.

What is an ETF and How Does it Work?

An Exchange Traded Fund (ETF) is like a mutual fund but trades on the stock exchange, just like a regular stock. Instead of buying shares of individual companies, you’re buying a share in a pool that invests across multiple companies, sectors, or assets.

For example, if you buy an ETF based on the Nifty 50, you’re automatically investing in all 50 top companies listed in the Nifty index.

Why Should You Consider Investing in ETFs?

• Diversification: Get exposure to multiple sectors and companies in one investment.
  
  
• Cost-Effective: ETFs usually have lower expense ratios compared to mutual funds.
  
  
• Transparency: ETF holdings are publicly available and updated daily.
  
  
• Liquidity: Since ETFs are traded like stocks, you can buy and sell anytime during market hours.
  
  

Imagine going shopping—you’d rather buy a combo pack of snacks than pick 10 different packets separately. ETFs are that combo pack for investors.

Factors to Look for Before Choosing the Best ETF in India

Before picking the best ETF in India, ask yourself:

1. Expense Ratio – How much will it cost you annually to hold the ETF?
   
   
2. Liquidity – Is the ETF actively traded, making it easier to buy or sell?
   
   
3. Tracking Error – Does the ETF closely follow its benchmark index?
   
   
4. Fund Size (AUM) – Larger ETFs generally have more stability and liquidity.
   
   
5. Underlying Index – Does the ETF track large-cap, mid-cap, gold, or international stocks?
   
   

Types of ETFs in India

• Equity ETFs – Track indices like Nifty 50, Sensex, or sectoral indices.
  
  
• Debt ETFs – Invest in government or corporate bonds.
  
  
• Gold ETFs – Track domestic gold prices.
  
  
• International ETFs – Provide exposure to global markets like Nasdaq 100.
  
  
• Sectoral ETFs – Focus on sectors like banking, IT, or energy.
  
  

Top 10 ETF Funds in India 2025

Here’s our carefully curated list of the top 10 ETF funds in India you should consider for 2025:

1. Nippon India ETF Nifty BeES

One of the oldest and most trusted ETFs in India. It tracks the Nifty 50 Index, giving you exposure to top companies like Reliance, TCS, and HDFC Bank.

2. SBI ETF Nifty 50

Backed by SBI Mutual Fund, this ETF is known for its low tracking error and solid liquidity.

3. HDFC Sensex ETF

Perfect for those who want to invest in India’s top 30 companies through the BSE Sensex index.

4. UTI Nifty Next 50 ETF

If you’re looking beyond the top 50, this ETF invests in the next 50 companies, offering higher growth potential.

5. ICICI Prudential Nifty 100 ETF

Covers India’s top 100 companies, giving broader exposure to large-cap stocks.

6. Kotak Banking ETF

Focuses exclusively on the banking sector, ideal if you believe in the long-term growth of Indian banks.

7. Motilal Oswal Nasdaq 100 ETF

Want global exposure? This ETF lets you invest in top US companies like Apple, Amazon, and Microsoft.

8. Axis Gold ETF

If you want a hedge against inflation, this gold-backed ETF is a safe bet.

9. Mirae Asset Nifty 50 ETF

Known for low costs and high liquidity, this ETF is a favorite among new investors.

10. Edelweiss ETF Nifty PSU Bank

Targets public sector banks in India. It’s a higher-risk, higher-reward option.

Best ETF to Invest in 2025

The best ETF to invest depends on your financial goals:

• For safety and stability: SBI ETF Nifty 50 or Nippon India ETF Nifty BeES.
  
  
• For global exposure: Motilal Oswal Nasdaq 100 ETF.
  
  
• For sector-specific growth: Kotak Banking ETF or Edelweiss PSU Bank ETF.
  
  
• For wealth protection: Axis Gold ETF.
  
  

Benefits of ETFs vs Mutual Funds

• Lower Expense Ratios – ETFs are cheaper to hold.
  
  
• Real-Time Trading – Unlike mutual funds, ETFs can be traded anytime.
  
  
• More Transparency – ETF portfolios are updated daily.
  
  

Risks of Investing in ETFs

• Market Risk – ETFs follow the market, so they rise and fall with it.
  
  
• Liquidity Risk – Some ETFs may have low trading volume.
  
  
• Tracking Error – Poor fund management can lead to differences between ETF and index returns.
  
  

Who Should Invest in ETFs?

• Beginners looking for simple, diversified investments.
  
  
• Long-term investors who want steady market returns.
  
  
• Cost-conscious investors who prefer lower fees.
  
  

Step-by-Step Guide: How to Invest in ETFs in India

1. Open a Demat and Trading Account.
   
   
2. Select the ETF you want to invest in.
   
   
3. Place a buy order through your broker.
   
   
4. Hold for long-term growth or trade for short-term gains.
   
   

Tax Implications on ETF Investments

• Equity ETFs:
  
  
• Short-term (less than 1 year): 15% tax.
  
  
• Long-term (more than 1 year): 10% tax on gains above ₹1 lakh.
  
  
• Debt/Gold ETFs:
  
  
• Taxed as per debt mutual funds with indexation benefits.
  
  

Final Thoughts: Are ETFs Right for You?

ETFs are among the best investment tools in India for those who want simplicity, diversification, and cost-effectiveness. Whether you’re just starting your investment journey or looking to expand your portfolio, ETFs can help you strike the right balance.

The key is to align your ETF choice with your goals—safety, growth, global exposure, or wealth protection.

FAQs

1. Which is the best ETF in India right now?
   The SBI ETF Nifty 50 and Nippon India ETF Nifty BeES are among the best ETFs in India due to their stability and liquidity.
2. What is the minimum amount needed to invest in ETFs?
   You can start with as little as the market price of one ETF unit, often around ₹100–₹200.
3. Is ETF better than mutual funds?
   ETFs usually have lower costs, better transparency, and trade flexibility compared to mutual funds.
4. Can I invest in international ETFs from India?
   Yes, ETFs like the Motilal Oswal Nasdaq 100 ETF allow you to invest in global giants like Apple and Amazon.
5. Are ETFs safe for beginners?
   Yes, ETFs are relatively safe and beginner-friendly because they spread risk across multiple companies or assets.