HDFC Nifty Banking ETF

The HDFC Nifty Banking ETF, managed by HDFC Asset Management Company Limited, aims to replicate the NIFTY Bank Index's total returns, emphasizing a passive investment strategy within an open-ended structure.

This ETF employs a tracking approach closely aligned with the NIFTY Bank Index (TRI), maintaining a low tracking error of 0.03%, ensuring efficient index replication with minimal deviation.

The portfolio is heavily concentrated in banking stocks, with top holdings including HDFC Bank Ltd. at 28.6% and ICICI Bank Ltd. at 26%, reflecting significant sector exposure and potential concentration risks.

Performance metrics indicate a 1-year return of 1.6% and impressive 3-year and 5-year CAGR of 12.97% and 21.10%, respectively, showcasing strong historical growth relative to its benchmark.

With an expense ratio of 0.16%, the fund remains cost-effective, while the experienced management team led by Arun Agarwal since 2020 supports operational efficiency and strategic oversight.