DSP Mutual Fund launches MSCI India ETF: All you need to know

DSP Mutual Fund has introduced the DSP MSCI India ETF, offering investors a strategic avenue to capture a diversified portfolio of large- and mid-cap stocks across critical sectors such as technology, financials, consumer services, and more. The New Fund Offer opened on 10 November and is set to close on 19 November. It stands poised to replicate the MSCI India Index, which spans well beyond narrower benchmarks like the Nifty 50, aiming to provide a more balanced exposure to India’s rapidly evolving economy. This product also forms part of the asset manager’s passive range covering equity, debt, and commodities.

Analysts say a potential revival in global investor sentiment toward India could impact stocks included in the MSCI India Index. While foreign institutional investment in Indian equities has moderated significantly since late 2021—approximately ₹1.4 trillion in outflows—the MSCI India Index itself has maintained a track record of around 14% annualised return over the past 27 years.

This historical performance showcases the index’s endurance through varied market cycles. By anchoring to such an index, the DSP MSCI India ETF aspires to capture potential gains from a broad segment of the market, rather than focusing on a handful of top stocks.

Unlike overseas-listed ETFs, dividends received and portfolio rebalancing within this fund are not subjected to immediate taxation in India, an aspect that might enhance long-term efficiency for domestic and non-resident participants.

Those seeking monthly SIP-related projections should note that no official figures on 3-year or 5-year SIP returns have been provided. DSP Mutual Fund, which already manages an array of active and passive products, highlights the ETF’s potential as a cost-effective route to capitalise on India's dynamic growth without having to select individual stocks.