“Dear David, As a Barclays stockbrokers client I have been searching for a suitable ETF to play the Indian market, do you have any advice on how I can achieve this cost effectively via ETF or any other vehicle via the UK.”

David Fuller's view

Certainly, and as a general comment to all subscribers, I will mention that Eoin & Sarah Barnes are actively engaged in a massive restructuring of the Chart Library, to make it easier to navigate, which became necessary as it now contains so many instruments. Working on this every day, they hope to have it completed before the end of September.  Meanwhile, if you do not know the name or code of an instrument that may be of interest, such as an India fund or investment trust, use the Library’s ‘Search’ facility for India.  If you have opened the Library so that it fills your screen, this will produce and highlight everything in the Library containing the word India in its title.  When you find something of interest to you, consider adding it to your Favourites by clicking on the green cross to the left of each instrument.  Once in your Favourites section, you can drag and drop it wherever you want.

There are several India funds, ITs and ETFs in that section and I will single out two.  I have owned the JPMorgan India Fund (JII LN) since 2003, adding to it occasionally on setbacks.  It is easily one of my three largest personal investment positions, although the rupee’s weakness relative to sterling since 2010 (shown inversely), caused it to underperform before Raghuram Rajan became governor of the Bank of India in mid-2013.  I believe this currency risk is now much lower due to governance changes.  However, if I were buying India today I would select the New India Investment Trust (NII LN).  I think of it as being in the Aberdeen group, although not by name for some reason.  More importantly, it is run by the highly respected Hugh Young of Aberdeen; has a discount to NAV of just over 9% and has outperformed JII.  It is temporarily overextended so I would prefer to buy on reactions, which will inevitably occur, although probably not like the last few years because there is a wall of money waiting to enter India.  I think the performance going forward will be more like 2004 to 2006 and 2009 to 2011.