Exchange Traded Funds (ETF) have found a new fan - the Bombay Stock Exchange (BSE) is all set to increase its focus on these funds. CNBC-TV18's Mrinalini Krishna reports that after losing the battle in the cash and derivatives segment, the Bombay Stock Exchange is now focusing on making 'the exchange' the place to be, for niche instruments. Exchange Traded Funds or ETFs are now the weapon of choice. With the NSE allowing the BSE to trade in NSE-listed ETFs, the BSE has seen volumes surge. This has been fuelled by some strong festive buying as well. Ashishkumar Chauhan, Deputy CEO, BSE said, "We have started trading many ETFs recently and we have seen tremendous growth over the last few days that we have traded. So we have a lot of hope on ETFs."
There are 18 ETFs listed on the BSE and this should pick up further. The global ETF industry hit an all time high in August, with Assets under management hitting USD 890 billion. AUMs for European ETFs also rose to an all time high of USD 192 billion. But with a lack of incentives to distributors, Indian ETFs have not seen many takers accounting for a paltry Rs 900 crores, or USD 413 million in assets under management. Experts say that with the removal of entry loads, ETFs are no longer at a disadvantage.
