I have an equity-linked savings scheme (ELSS), three large-cap funds and one liquid fund. I want to invest in an exchange-traded fund (ETF). How do I choose one?
—Siddharth Bisht
Typically, one aims to diversify through asset classes, market segments and market sectors. But one can also diversify by having managed an index fund. In managed funds, a fund manager determines where to invest and when. In index funds, the decision is made automatically by following a preset index (such as Nifty or Sensex). Investing in such funds is typically done through ETFs.
