India Dedicated Funds That NRIs From US Can Invest In

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Non Resident Indians (NRIs) in the US face a typical problem when it comes to investing in mutual funds in India. Most mutual funds in India, which have their head-offices in the US cannot accept money from NRIs in the US.

India Dedicated Funds That NRIs From US Can Invest In
This is peculiar only to the US, while NRIs in other countries can freely apply directly for mutual fund units in India, through a host of mutual funds here. However, what NRIs in the US can do is look at India dedicated funds to invest in. These funds invest money in Indian companies to churn returns and NRIs in the US can invest in these mutual funds. Here are a few India dedicated funds for NRIs from the US to invest.

Mathews India Fund

This fund invests almost 80 per cent in the Indian markets. The asset size by the end of Dec 2015 was close to $ 1.51 billion.

Returns by the Mathews India Fund
1 year returns3 year returns5 year returns10 year returns
0.90%15.84%5.37%11.10%

The company has investment in Taro Pharma, IndusInd Bank, ITC, Shriram City Union, which are the top holdings of the fund.

The risk for the fund include currency risk, volatility of stocks, particularly to emerging markets and volatility in some smaller stocks that the fund holds.

The fund has managed to generate positive returns in the last 1 year, despite the fact that Indian benchmark indices are down almost 9 per cent in the last one year.

Eaton Vance Greater India Fund

This fund invests primarily in India, though it has a mandate to also look at Pakistan and Sri Lanka. However, if you see the portfolio of top holdings it comprises mostly of Indian companies with names like ITC, HDFC Bank, HDFC, ICICI Bank and Yes Bank forming the top 5 of its portfolio.

Here is a look at the returns from the Eaton Vance Greater India Fund
1 year3 year5 year10 year
-4.96%5.99%-1.25%4.91%

Like most other India dedicated funds the risk remain the huge volatility in the emerging markets. The fund has not seen an exceptional performance in the last few years. In fact, the portfolio is heavily geared to the banking sector and any recovery in banking stocks in India, could give a boost to the fund.


Waswatch Emerging India Fund

The fund invests primarily in Indian companies to generate returns. The one year return of the fund has been close to 4.16 per cent, while the fund has generated near 9 per cent returns since inception.


Returns From Waswatch Emerging India Fund
1 year returnReturns since inception
4.16%9.83%

The Fund is managed by Ajay Krishnan. NRIs should remember that investing in emerging markets like India, through India dedicated funds, could pose currency and volatility risks, as these markets are slightly more volatile than developed markets.

Another thing to remember about this fund is that it invests in small and mid sized companies, where the volatility, that is price movement either ways is much more sharper.

The holding is not spread, which could be a further risk. Wawsatch Funds deducts a 2 per cent for redemption proceeds, if you redeem within 6 months.

Conclusion

India dedicated funds for NRIs in the US is one option that they can consider. There are many such funds, which we are not able to highlight all. The above is not a recommendation to invest, but just an informative article.

Disclaimer

This article is strictly for informational purposes only. It is not a solicitation to buy securities or other financial instruments mentioned herein. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and the author of this article do not accept culpability for losses and/or damages arising based on information in this article. You may please seek professional help.

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Read more about: nris, india dedicated funds
Story first published: Monday, February 1, 2016, 8:44 [IST]
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