Build a simple long-term portfolio with these 5 ETFs to diversify
This is the list of 5 ETFs which covers Indian stocks, commodities and global stocks
STOCK ANALYSIS
Harsh Garg
9/26/20264 min read
SBI Nifty 50 ETF – Core Indian large-cap exposure at very low cost
The SBI Nifty 50 ETF allows you to invest in India's 50 largest listed firms in one investment. For long-term investors, this serves as a "core" investment because it contributes to the general growth of the Indian economy through well-established enterprises.
Its main advantage is cost: the expense ratio is roughly 0.04%, which is among the lowest for stock ETFs in India. Over a period of 10-20 years, even minor cost disparities add up to a considerable difference in total value. The fund also has a substantial AUM and liquidity, making buying and selling simple with low fees.
This ETF is appropriate as the primary equity component in a long-term portfolio, particularly if you want easy, diversified exposure to Indian large caps without stock-picking.
HDFC S&P BSE Sensex ETF – Focused bet on India’s top 30 companies
The HDFC Sensex ETF tracks the BSE Sensex, which is made up of 30 major and sector-leading firms. This provides concentrated exposure to India's blue-chip equities in important industries such as banking, information technology, energy, and consumer goods.
Long-term investors benefit from diversified large-cap exposure, reduced volatility compared to mid- and small-cap indices, and an easy method to participate in India's growth narrative. The ETF is designed for investors with a three-year or more time horizon expecting low-cost index-linked returns.
If you prefer a somewhat more concentrated large-cap index than the Nifty 50, with a focus on the most well-known names, this ETF works well as a core or secondary position in a long-term portfolio.
ICICI Prudential Gold ETF – Inflation hedge and portfolio stabiliser
The ICICI Prudential Gold ETF invests in physical gold and seeks to track domestic gold prices. Long-term investors use gold as a hedge against inflation, currency depreciation, and periods of significant equities market volatility.
Key long-term benefits include purity and safety (no need for charges or storage), high liquidity when compared to physical gold, and the option to store gold in demat form as part of an asset allocation plan. Gold has historically generated fair long-term CAGRs and performs well when risk sentiment is low, hence reducing overall portfolio drawdowns.
This ETF is best suited for long-term portfolio stability and diversity rather than maximum gains. A little allocation (5-15%, depending on the risk profile) can improve the entire journey.
ICICI Prudential Silver ETF – Growth-orientated precious metal exposure
The ICICI Prudential Silver ETF provides exposure to silver prices in a demat-form, liquid structure. Silver has both investment and industrial demand (electronics, photovoltaic, etc.), which can result in better growth potential than gold in some cycles, although with greater volatility.
For long-term investors, silver can serve as a secondary allocation inside the precious metals bucket. It provides a low-cost and pure alternative to investing in silver without having to deal with physical storage, purity difficulties, or big-ticket amounts. Over extended time horizons, silver's dual demand drivers (investment and industrial) can help create wealth, particularly during periods of significant industrial expansion and green energy transitions.
Silver is more volatile than gold; thus, it is better suited as a smaller, tactical component of a long-term portfolio rather than a main position.
Motilal Oswal Nasdaq 100 ETF – Global tech and innovation exposure
The Motilal Oswal Nasdaq 100 ETF tracks the Nasdaq-100 index, which is dominated by significant US technology and innovation companies (software, internet, semiconductors, consumer technology, and so on). For Indian investors, this offers geographical diversification and access to global leaders that are not readily available in India.
Long-term benefits include participation in the rise of global tech giants, diversification away from India-specific risks, and access to industries such as AI, cloud computing, and digital advertising, which account for a significant portion of global revenues. When paired with Indian stock ETFs, global equity exposure can improve risk-adjusted returns over time.
This ETF is best used as a secondary position in a long-term portfolio, supplementing your Indian core (Nifty/Sensex) with global growth and industry diversification.
Bottom line
For smart long-term investing, use SBI Nifty 50 ETF and HDFC Sensex ETF as your core Indian equity base for steady, low-cost growth; add ICICI Gold ETF (and a smaller slice of Silver ETF) to protect against inflation and market shocks; and include Motilal Oswal Nasdaq 100 ETF for global tech exposure; stay disciplined with regular investing, keep costs low, and rebalance occasionally rather than chasing short-term moves.
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