Paytm on Tuesday announced that its wholly-owned subsidiary ‘Paytm Money’ has launched Exchange-Traded Funds (ETFs) on its platform, post-approval from the Securities and Exchange Board of India (SEBI). These are passive funds that are listed on NSE /BSE and traded like regular equity shares proving the merits of mutual funds along with the return potential of stocks. With this inclusion, the company becomes a comprehensive platform wherein investors from across all financial and knowledge backgrounds can conveniently access ETFs.?
The platform will allow ETF investments for as low as Rs 16 in Equity, Rs 44 in Gold and Rs 120 for NIFTY. The platform will allow users to track the price changes in the preferred ETFs and will update the live prices of an ETF. It empowers investors to place a sell order during the open market hours and receive the money directly in their bank account.
Advanced investors can even execute intra day trades in ETF and the simple stop loss/target price orders allow users to automate their risk management. The investor also gets the flexibility to invest via both the Paytm Money app and the Paytm Money website.?
What are ETFs
For those unaware, ETFs are a relatively low-cost option since passive fund management results in the funds having a lower expense ratio. For investors putting in smaller amounts, the benefit of compounding, coupled with low fund management costs would enable them to boost the portfolio returns.
In India, there are 69 different kinds of ETFs available across the index, gold, equity and debt categories with top-performing ETFs such as Aditya Birla Sun Life Gold ETF, Nippon India Nv20 ETF, LIC G-Sec Long Term ETF among others. They have delivered returns to the tune of 18.67%, 10.29% and 8.43%.?
Varun Sridhar, CEO – Paytm Money said, “ETFs are investment avenues that everyone should add to their portfolio to earn index or market-linked returns at a lesser cost. At Paytm Money, our efforts have been to democratize and simplify wealth management for all and in the case of ETFs also we have simplified investing for everyone. We are offering a user-friendly interface along with necessary factors that the user may need to make an informed decision and invest in ETFs of their choice conveniently. We are targeting 100k users to invest in ETFs in the next 12 to 18 months through the platform.”