BMO India Equity Hedged to CAD ETF (ZID.TO)

Thematically, India has 1.3 billion people, world's largest democracy. 65% of those people are under 35, so they have 800 million of people of consumption driven growth. 7.5% GDP. Business friendly reforms. Infrastructure projects in an under penetrated market. Analysts assume the Indian stock market can grow earnings at 22%.

XID-T vs. ZID-T. A Difference in Tax Treatment? With a Canadian based ETF holding US ETFs subject to US withholding tax you can get double withholdings. He suggests asking the ETF provider what the tax consequences are for holding their funds in your Canadian account.

He likes this and does use it a bit, but uses XID more. Both are quite similar. It’s a good, diversified low cost way of getting access to India. A good product and is one that he would absolutely hold for the long-term.

An ETF on Indian equities, hopefully with a better yield? There is the ZID. There are versions in the US you can buy, but this one is in Cdn$. He loves India long-term. You are not hedged to the currency on this. You are exposed to the fluctuations of the Indian rupee and US$, because there is some US$ imbedded exposure in that.

India. He really likes India and small caps are the way to play it. He started to get out when we started re-testing the highs. He is going to buy dips in India because he loves the story. He makes decisions based on risk and return. If you like it long term then stick with it.

He is a proponent of emerging markets in general. If he were to use only one country to invest in, it would be India. This is a good product and one he uses personally. He wouldn’t go more than 7%-8% of your portfolio.

Very similar to iShares CNX Nifty India (XID-T) and they are interchangeable. He likes them both. India is a very good way to get the growth you need. (See Top Picks.)

India has tried to monetize some of their gold, even some held in temples in India. They just lost their finance minister. The problem is the layers of bureaucracy. He expects great things over the long term. You have to be very patient.

(A Top Pick Feb 9/15. Down 10.11%.) Sold his holdings. This one is very volatile. Still likes it and thinks India is one of the best names for investors in Cdn$’s, but the downtrend has to be broken first.

Which India ETF would you prefer for the long-term? This one from the Bank of Montréal is good. They’re relatively homogenous. What you get when you start getting a country specific ETF in Canada, is generally something that tracks a broad benchmark and there is not a lot to choose between them. If you have a US one, you get additional tax reporting problems and there is currency hedging. If you buy something in US$ and then the Cdn$ appreciates, you are going to get the return of the underlying benchmark, but you are going to have to give some of that back when you convert the currency.

There is a lot of hopefulness about what Mohdi is going to be able to do in India. He doesn’t know that this has translated as yet into good returns, or how long it is going to take. They have clearly had a problem of being the non-aligned country for a long time. Bureaucracy is a huge problem, and the country has all kinds of problems. On the other hand, as a growth story it could be terrific. This is a tough one to pick.

When you get down to the country ETF’s, they are a little bit different certainly than the industry ETF’s. A lot of it comes down to familiarity, i.e. if you know India, spent time there or come from an Indian background. 10 stocks represent 90% of this index. If you want to go into something like this, just look at the top 10 stocks. If you know them and are comfortable with them that’s great. Otherwise he would be careful.

Right now emerging markets are probably not on the favourite list of many strategists and portfolio managers. However, he would put India at the top of that list comparing it against China, Brazil, Russia, etc. Keep in mind that this is a net importer of commodities. Lower commodity prices are beneficial to them. He likes that they have very positive political leadership on how it is helping the financial side of things. Demographics look good. If you do want exposure to emerging markets, India is a pretty strong name to hold.

Very intrigued by India because the PM Modi has made some great promises. Doesn’t know how successful he is in actually implementing them, but there is a big change there in regulations, capital markets, etc. He would look on this one favourably.

Owned this for a while and recently sold it on the rally. He wanted to reduce his overall beta, and thought India might have too much volatility for his liking. Also, it seemed to be breaking an uptrend. He would be a little nervous because of the break earlier this year.