Best International ETFs in India: Global ETFs

What are International ETFs?

International or global ETFs in India are exchange-traded funds that track equity indices of stock markets outside India. Buying one unit on NSE gives an investor proportional exposure to all companies in the underlying foreign index without opening an overseas brokerage account, making an LRS remittance, or managing foreign currency. International ETFs also add a currency layer. Since many of them invest in foreign assets, their returns can be affected by both the underlying market performance and currency movement, such as the rupee-dollar exchange rate.

Overview of the Best International ETFs in India

• Motilal Oswal NASDAQ 100 ETF (MON100):MON100 tracks the NASDAQ 100 Index, offering exposure to large Nasdaq-listed non-financial companies, largely led by US technology names. It has the highest AUM among Indian international ETFs, with a long track record since 2011.
• Mirae Asset NYSE FANG+ ETF (MAFANG): MAFANG tracks an equal-weighted basket of 10 major global technology and internet companies, including Meta, Apple, Amazon, Netflix, Alphabet, NVIDIA, Microsoft and Tesla. Its concentrated structure can amplify both upside and downside.
• Mirae Asset S&P 500 Top 50 ETF (MASPTOP50): MASPTOP50 tracks the 50 largest companies in the S&P 500 by market capitalisation. It offers concentrated exposure to US mega-cap companies such as Apple, Microsoft, NVIDIA and Amazon, without covering the full S&P 500 universe.
• Motilal Oswal Nasdaq Q50 ETF (MONQ50): MONQ50 tracks the NASDAQ Q-50 Index, covering companies ranked 101st to 150th on Nasdaq by market capitalisation. It offers exposure to potential future NASDAQ 100 entrants, but its lower AUM may affect liquidity.
• Mirae Asset Hang Seng TECH ETF (MAHKTECH): MAHKTECH tracks the Hang Seng TECH Index, offering exposure to 30 Hong Kong-listed technology companies, including Alibaba, Tencent, Meituan, Xiaomi and Baidu. Its performance has been affected by China’s regulatory, geopolitical and market headwinds.

How to Invest in International ETFs in India?

Investing in International ETFs in India is straightforward:

1. Open a demat/trading/stockbroker account. You can open a demat account with smallcase!
2. Investors can use the Tickertape Stock Screener to analyse the list of International ETFs and compare them to identify the best International ETF in India based on various factors.
3. Place a buy order

Taxation of Global ETFs in India

Global ETFs in India are taxed based on their scheme classification and the applicable mutual fund taxation rules. If the ETF is classified as an equity-oriented scheme, it is subject to equity capital gains tax treatment under the post-Budget 2024 rules.

• Short-Term Capital Gains Tax: If the units are sold within 12 months, the gains are treated as short-term capital gains. These gains are taxed at a flat rate of 20%.
• Long-Term Capital Gains Tax: If the units are held for more than 12 months, the gains are treated as long-term capital gains. These gains are taxed at 12.5%, after the annual exemption limit of ₹1.25 lakh across eligible equity investments.
• Dividend Taxation: Any dividend received from the ETF is added to the investor’s total income and taxed as per their applicable income tax slab.

Features of International ETFs in India

• No LRS Required: Unlike direct US stock investment via platforms like, buying international ETFs on NSE involves no overseas remittance. The fund house manages the foreign investment pool. The investor buys an Indian exchange-listed unit with a regular demat account.
• Geographic Diversification: The Indian equity market is concentrated in financials, IT, energy, and consumer sectors. International ETFs provide exposure to segments with no direct Indian-listed equivalents: US semiconductor companies, Chinese internet platforms, and US streaming media, all of which are low-correlation with the Nifty 50.
• Currency Diversification: Since the underlying holdings are denominated in USD, a weakening rupee increases the INR value of the fund’s foreign holdings, providing a natural hedge against rupee depreciation. The reverse is also true: rupee appreciation reduces returns expressed in INR.
• Passive Management and Daily Liquidity: ETFs are passively managed. They replicate an index, make no active stock-selection decisions, and charge expense ratios well below those of actively managed funds. Units trade on NSE during normal market hours, and there is no exit load on any of the six.

Advantages of Investing in International ETFs

• Access to Global Companies: Many global companies and themes are not directly available in Indian markets. International ETFs can offer exposure to sectors such as global technology, AI, semiconductors, healthcare, electric vehicles, consumer internet and cloud computing through a single listed instrument.
• Reduced Country-Specific Risk: A portfolio invested only in Indian assets may be affected by domestic policy changes, currency movement, inflation, interest rates or sector-specific events. International ETFs can help spread this risk by adding exposure to overseas markets and companies.
• Foreign Currency Exposure: International ETFs can also give investors exposure to foreign currencies such as the US dollar. For Indian investors, this can work both ways. A weaker rupee may add to returns when foreign investments are converted back to INR, while a stronger rupee may reduce returns.
• Simple and Transparent Structure: Most international ETFs track a defined index, such as the NASDAQ 100, NYSE FANG+ or Hang Seng TECH. This makes it easier for investors to understand what the ETF holds, which market it tracks, and how concentrated or diversified the exposure is.

Risks of Investing in International ETFs

• Currency Risk: International ETFs expose investors to foreign currency movement. For Indian investors, this often means rupee-dollar movement. If the rupee weakens, it may add to INR returns. But if the rupee strengthens, it can reduce returns even if the underlying ETF performs well.
• Foreign Market Volatility: International ETFs are affected by overseas market conditions. Interest rates, inflation, economic growth, elections, geopolitical tensions and central bank actions in other countries can impact performance. For example, a US-focused ETF may react sharply to Federal Reserve policy or US earnings trends.
• Concentration Risk: Some international ETFs are concentrated in a few companies, sectors or geographies. Technology-heavy ETFs, for instance, may depend heavily on large-cap tech stocks. If a few top holdings fall sharply, the ETF’s overall returns can be affected.
• Regulatory and Country Risk: International ETFs are exposed to rules and policies in the countries they track. Changes in foreign regulations, trade policies, taxation, sanctions or capital controls can affect the ETF’s performance, especially in emerging or politically sensitive markets.

Factors to Consider Before Investing in International ETFs

• Underlying Index: The underlying index determines what the ETF actually tracks. For example, a NASDAQ 100 ETF gives exposure to large Nasdaq-listed non-financial companies, while a Hang Seng TECH ETF focuses on Hong Kong-listed technology companies. Investors should check the index methodology, top holdings and sector exposure before investing.
• Country and Sector Exposure: International ETFs can be broad or highly concentrated. Some may offer exposure to the US market, while others may focus on China, Hong Kong, technology, healthcare or other global themes. A concentrated ETF can offer higher upside during strong market phases, but it can also carry higher downside risk.
• Currency Movement: International ETFs also bring currency exposure. For Indian investors, the rupee-dollar movement can affect returns. A weaker rupee may add to INR returns, while a stronger rupee may reduce them.
• Taxation: International ETFs may not be taxed the same way as domestic equity funds. Investors should check capital gains tax rules, holding periods and dividend taxation before investing.
• Investment Horizon and Risk Appetite: International ETFs can be affected by foreign market volatility, currency movement, geopolitical events and interest-rate cycles. Investors should ensure the ETF matches their investment horizon, risk appetite and overall portfolio goals.