In a budget that holds no surprise for ordinary investors, the finance minister has clearly opened the floodgates for exchange traded funds (ETFs), thus turning the spotlight on an investment option that has so far remained neglected, except for sporadic, transient periods. The FFO, which drew a significant number of investors, has done especially well over the past few days, evident from very large traded volumes. It is pertinent to note here that the latest budget has specifically identified three PSEs — IRCTC, IRFC and IRCON — that are all closely linked to the Indian Railway. ETFs, I clearly believe, are among the least understood categories of funds in our country, despite sporadic spikes in their trading patterns. Indeed, index funds in general are not too appreciated in India — the average market participant’s focus has remained entirely on actively-managed investment vehicles.

Source: The Telegraph February 01, 2017 22:15 UTC