Just like the BeEs of the Nifty index, there are Bank BeEs. This is also an exchange-traded fund (ETF) and is a popular investment under the Mutual Fund category. This ETF comes under the benchmark of the Bank Nifty Index. It is almost similar to Nifty Bees, the only difference is it works on Bank Nifty rather than Nifty Index. Here, in this content, you will find the answers to What is Bank BeEs ETF and How to Invest in It.
What is Bank BeEs ETF?
This is a Bank Exchange Traded Fund of Goldman Sachs. One of the main objectives of the Fund is to correspond total returns of the Bank Nifty Index. This exchange-traded fund holds all of the twelve stocks of Bank Nifty (a similar portion in the Bank Nifty Index). Investors who want to invest in the top banks and wish to diversify his/her portfolio can do so by investing in the Bank BeEs ETF.
The Fund was launched in the year 2004, June 4. The fund has generated, since inception, a CAGR return of 20.83% in comparison to 19.52% of the Bank Nifty Index.
How to Invest in Bank Bees ETF?
Any investors who wish to buy or sell this Bank ETF can easily do it from their Demat account by themselves or by their financial broker. Similar to stocks, traders can buy this ETF at any time, at the market price during the trading day. The buying price is also quite minimal. So, in the case of buying stock, brokerage fees attract.
Key Facts of Bank BeEs
- Benchmark Index: Bank Nifty Index
- BSE Code: 590106
- NSE Symbol: BANKBEES
- ISIN: INF732E01078
- Fund Type: It is an Open Ended Index Scheme, listed in the exchange in the form of ETF.
- Pricing: Approximately 1/10th of Bank Nifty Index
- Investment Objective: As represented by the Bank Nifty 50 Index, it replicates the total return of the securities.
- Managers: Goldman Sachs Asset Management Ltd
- Taxation Treatment: Equity
- Minimum Lot Size (Exchange): One unit per share
- Minimum Lot Size (Directly with Fund): 1000 units
- Entry/Exit Load: Nil
- Maximum Expense Ratio: 0.80% Annualized
Bankbees and Nifty Bees are special exchange-traded funds (ETFs) designed to help you invest in the Indian banking industry and CNX Nifty Index, respectively. Therefore, these ETFs enable investors to generate returns equal to the gains or losses of the underlying index traded on India’s stock exchanges.
The composition of banks for the BankBeES ETF includes Axis Bank, HDFC Bank, SBI, ICICI Bank & Kotak Mahindra. This list may change from time to time as per changes made by the fund managers.
Trading with BankBeES is the same as how you would buy any other stock through a broker or online brokerage platforms such as Zerodha Kite and Upstox Pro. You need to place a normal equity buying/selling order, which will execute once it matches another market participant’s order at the desired price point.
Besides Nifty and Bank BeEs, there are other BeEs available in the Indian financial market such as Liquid BeEs, Gold BeEs, etc. Investors get exposure to the top 12 capitalized Indian Banks by investing in this ETF. So, basically, the Bank BeEs (representing the Indian Banks) make investors free from worries about finding the right bank to invest in. Moreover, the fund manager will automatically replace the non-performing bank will be with the performing one.