Hear me out before downvoting. For those of you who don't know, nifty50 is indias benchmark stock market index just like sp500 except it has 50 companies instead of 500 companies. Over past 20+ years nifty50 has massively outperformed sp500,nasdaq and dow and its not even close. (https://www.google.com/finance/quote/NIFTYBEES:NSE?window=MAX&comparison=NYSEARCA%3ASPY%2CNASDAQ%3AQQQ%2CNYSEARCA%3ADIA) On jan 1st 1999, nifty50 was at 890..today its at 18000+..in past 24 years it has more than 20x..meanwhile sp500 on jan 1st was at 1200 and today its at 3900+..more than 3x. Now i know alot of you will bring up currency. so lets consider that..in 1999 1 dollar was about 42 rupees..today its 80 rupees…so rupee has lost roughly half its value vs dollar but even than the difference is massive. Consider the following scenario. 1 dollar invested in Nippon India Nifty 50 Bees Etf(Niftybees)in jan 2002 would be worth about $9 today after accounting for currency difference. 1 dollar invested in sp500 in jan 2002 in sp500 etf(spy) would be worth about $3.50 today. I expect nifty50 to outperform sp500 even more over coming decades given the fact that india is on its path to become second largest country by gdp by 2050. over next 20-30 years india is going to be fastest growing asian economy according to morgan stanley. Recently google, qualcomm, apple etc all have announced major investments in india. There will be billions pouring in foreign investments in indian economy over next few decades. combine that with indias young population and favorable demographics, india could see similar growth like china in coming years. But what about inflation? Now its true that india has a higher inflation rate (about 6% annually) but as a foreign investor you don't really care about inflation in india because you are not living there. All you should care about is currency difference and your return on investment. Ok but about corruption and default risks? India has massive foreign reserve(about 600 billion and growing) so default is really not a concern..as far as corruption and other risks goes, india has a regulatory agency called sebi which is similar to sec. In general there is higher risk with developing countries, however india has a fairly strong regulatory and enforcement system. I have been looking to invest in nifty50, but there is no true etf for nifty50 in us markets.. most of them are equally weighted, or sector based which is not what i am looking for. If you want to invest in niftybees or other indian etfs, you have to open a bank account in india and invest through a indian broker. Anyway my point is investing in nifty50 would give you far more returns than sp500 over next 10-20 years.. do you guys agree or am i missing something here? comments and discussion is welcomed. thank you. submitted by /u/Odd_Explanation3246 [comments]
