Groww, an investment platform in India, has launched two new mutual fund schemes targeting the development of the hospital and healthcare services sector in India. The schemes, namely the Groww BSE Hospitals ETF and the Groww BSE Hospitals ETF Fund of Fund (FOF), are intended to provide investors with an opportunity to link their investments to the important healthcare sector in India.
The two schemes track the BSE Hospitals Index, created by BSE to include hospital and healthcare service providers from the BSE 1000 universe. This is an indication of the rising interest in ideological mutual fund investments across India.
The Groww BSE Hospitals ETF is an open-ended exchange-traded fund that helps investors to directly invest in the healthcare industry. The fund invests in the shares of hospitals and healthcare companies that are part of the BSE Hospitals Index. The investment is made in the same proportion as the constituents of the BSE Hospitals Index, in a passive way.
It is listed on the stock exchange, which enables flexibility to buy and sell the units during market hours for those who have a demat and trading account.
The ETF Fund of Fund (FOF) is an easy way for those who do not have a demat account to invest in the healthcare industry. The fund invests in the units of the Groww BSE Hospitals ETF, which makes it easy for more people to contribute to the growth of the healthcare industry in India.
Both funds are designed to track the ups and downs of the BSE Hospitals Index, realizing that there are fluctuations in the market.
The BSE Hospitals Index is a sector index designed to monitor the performance of listed companies that provide hospital and healthcare services in India. The index is designed to concentrate on organizations that are mainly involved in running hospitals and providing healthcare services, chosen from the BSE 1000 universe of stocks.
This includes:
- Multi-specialty hospital chains
- Healthcare service providers
- Companies earning significant revenue from hospital infrastructure
The index provides investors with an opportunity to contribute to the Indian healthcare delivery system, which is recognised as important.
The Indian healthcare industry has been developing in a positive manner due to a number of hopeful signs:
- Rising healthcare expenditure because of rising incomes and awareness.
- Rising health insurance penetration, which enables more people to avail themselves of private hospital care. With government-supported programs and private insurers expanding their reach, hospitalization rates and revenues for organized hospital chains have increased.
Large hospital chains are increasingly looking to expand from metropolitan cities to smaller cities.
India’s position as a medical tourism destination also presents opportunities.
Demographic changes and lifestyle shifts are resulting in a growing need for specialized hospital care.
Both funds adopt a passive investment approach, which means that they try to track the performance of the index, thus keeping the costs low and making healthcare investment more affordable.
Since both funds are sector-based, their performance will depend on the performance of the sector. This might result in higher volatility, and therefore, they might be suitable for investors who are ready to take the ups and downs.Financial advisors recommend sector-based funds to create a balanced portfolio.
This launch also reflects the increasingly compassionate and focused nature of the mutual fund industry in India. The reduced costs, increased transparency, and accessibility have led more regular investors to join in.
Platforms such as Groww are playing an important role in making these opportunities more accessible to more people, so they feel connected to the story of healthcare in India.
Through the provision of the hospital-themed ETF and FOF, Groww is facilitating the trend of focused investing as well as the need for simpler and more accessible investment options.
Groww’s foray into hospital-oriented funds is a sign of their faith in the future potential of the Indian healthcare industry. As the demand increases and the infrastructure develops, this industry is turning out to be a motivating sector for making significant investments.
It is only time that will reveal whether this strategy will prove to be fruitful or not. One thing is for sure, though: passive investing is no longer a straightforward concept, and the healthcare industry is turning out to be a wise choice.
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