Nifty ETF is a new way of holding nifty future in your Demat account, now no need of rolling over positions at the time of expiry. NiftyBeeS has been one of the smartest ways of investment in the Nifty index for the long term. Let us see advantages and disadvantages over nifty future:
Advantages of ETF:
1. Nifty ETF can be held on your Demat, it is just the same as you take delivery of shares.
2. No need to roll over your positions on F&O expiry, as you have nifty ETF on your Demat account instead of trading account.
3. No need for M2M (mark to market) settlement, as you are holding nifty BeeS on the Demat account for delivery.
4. Nifty ETF can be used as a margin for buying shares for trading, this facility is provided by many stockbrokers.
Disadvantages of ETF:
1. It requires full margin i.e. the total value of the contract at the time of placing orders. Whereas nifty future needs as low as 10% margin requirement of the total contract value.
2. Fund expense is also applied and this can be around 2%.
3. Liquidity in nifty BeeS is much lower as compared to the nifty future.
You can also check all the listed ETF on NSEIndia.com.