BetaShares issues BetaShares India Quality ETF utilizing Solactive Index
Solactive is pleased to announce that Australian ETF provider BetaShares released its new BetaShares India Quality ETF (IIND). The ETF tracks the Solactive India Quality Select Index (SOLINQSN), which includes the top 30 of India’s domestic companies based on a weighted ranking of the following key factors – high profitability, low leverage, and high earnings stability. The ETF is tailored to investors, who believe that the fast-growing Indian economy keeps its momentum and continues in long-term and stable growth.
For a long time, India is among the fastest-growing economies in the world, with GDP growth of 7.5% p.a. over the last decade to 2018 and expected future growth over the next five years with equal rates as predicted by the International Monetary Fund. Furthermore, Indian stocks bear a fairly low correlation with global stocks, making the BetaShares India Quality ETF a legitimate vehicle for portfolio diversification.
The underlying index, the Solactive India Quality Select Index, selects its constituents based on a proprietary concept that takes into account a stock’s Return on Equity, 1-Year Earnings per Share Growth, Debt-to-Equity Ratio, and the Volatility of Return on Equity over the last five years. Based on a combination of these metrics and the size of the company in terms of Market Capitalization, a portfolio of 30 securities is determined.
“The Indian economy has further room to expand at higher-than-average growth rates. Although some points on the reform agenda will be painful and disruptive to the economy, like the banknote demonetization in 2016, Modi and his government seem to take necessary and promising steps. One example is the facilitation of FDIs that could boost investments in the country,” says Timo Pfeiffer, Head of Research at Solactive. “Working with BetaShares to facilitate Australian investors’ exposure to the Indian equity market was an exciting project for everybody involved.”
The BetaShares India Quality ETF was listed on 5th of August, 2019 on the Australian Securities Exchange (ASX).
Current index components are, for example, Tata Consultancy Services Ltd., Infosys Technologies, Hindustan Unilever Ltd., and ITC Ltd.