What Is Nifty Bees & How To Trade Nifty Bees On Zerodha? (2024)

FAQs

What is nifty BeES in Zerodha? ›

Nifty BeES (Benchmark Exchange Traded Scheme) is the first ETF in India. It is a portfolio of individual securities or stocks that tracks the underlying benchmark S&P CNX Nifty. Like any other ETF, Nifty BeES can be sold in the open market like any other stocks and securities.

To invest in Nifty BeES, you need to open a trading and demat account. Just as you would purchase shares, you can buy Nifty BeES units during trading hours on the stock exchange at prevailing market prices.

Nifty BeES can be bought / sold like a share through any NSE terminal at prices available on the screen. The underlying portfolio of Nifty BeES very closely replicates that of the S&P CNX Nifty. Hence, Nifty BeES tracks the movement of S&P CNX Nifty. Nifty BeES is a no load scheme.

For Nifty BeES, it is 50,000 units) sizes directly from the AMC. The detailed product note for Nippon India Nifty BeEs can be found here.

Disadvantages Of Investing In Nifty BeEs:

Lower Returns- Because Nifty beEs tracks the movement of a certain index, it delivers lower returns than mutual funds.

It is listed both on NSE and BSE. It has its own symbols and codes and transactions can be carried out anytime during the trading day at the market price determined by demand and supply, unlike mutual funds that can only be transacted at the close of the day.

There is no entry or exit load as this fund is traded on the secondary market. Charges for Liquid BeES and Liquid ETFs are as follows: Transaction charges of 0.00345% for NSE and 0.00375% for BSE on turnover (qty * price). 18% GST on the transaction charge.

The Nippon India ETF Nifty 50 BeES (G) was launched on Dec 28, 2001 with no lock-in period. Since its inception, the fund has delivered 15.6% as a return on investment. The fund has delivered a 1-year return of 23.8%, a 3-year return of 25.2%, and a 5-year return of 13%.

What is the minimum investment in Nifty BeEs? ›

Bank BeEs is a collection of the top 10 banks in India. Whereas Nifty BeEs is a collection of 50 biggest stocks in India. Bank BeEs is more compact and sectoral. Whereas Nifty BeEs contains stocks from more than 22 sectors.

Low cost: Nifty BeEs has a low expense ratio compared to actively managed funds. This cost-efficiency is beneficial for long-term investors as it minimizes the impact of expenses on overall returns.

The investors earn dividends on the amount they invest in NIFTY BeES based on the market moments. However, the distribution of the dividends solely depends on the surplus funds available with the company for dividend distribution.

The permitted lot size for futures contracts & options contracts shall be the same for a given underlying or such lot size as may be stipulated by the Exchange from time to time. The price step in respect of Nifty 50 futures contracts is Re.0.05.

Taxation of Nifty BeEs

However, if you continue to hold the same investments for a prolonged period, i.e., more than a year, the earnings from them are taxed at 10 per cent, sans the indexation benefit."

Each unit of Niftybees is 1/10th part of the S&P CNX Nifty Index value and 1/100th part of the Nifty 50 Index. Likewise, Nifty is calculated on a real-time basis, Niftybees provides real-time NAV and can be traded anytime on NSE.

1. Current NAV: The Current Net Asset Value of the Nippon India ETF Nifty 50 BeES as of Jun 16, 2023 is Rs 206.84 for IDCW option of its Regular plan. 2. Returns: Its trailing returns over different time periods are: 13.87% (1yr), 24.1% (3yr), 12.77% (5yr) and 15.39% (since launch).

You need a Demat account and trading account to complete the investment. According to the prevailing market rates, you can buy or sell Nifty BeES at any time of the day (trading hours). You can invest in Nifty BeES through SIP or a lumpsum plan.

If you want to trade on the Nifty, then you have no choice but to go for the Nifty ETF. But for long-term investors who are basically buy-and-hold investors, the index option makes far more sense than the ETF option.” “If you are a long-term investor, then you have a choice between Nifty ETF and the Nifty index.

Which ETF gives highest return in India? ›

Motilal Oswal Nifty Midcap 100 ETF has given a return of 36.69% in three years. This ETF tracks NIFTY Midcap 100 Total Return Index, which has given a return of 37.74% in this duration.

There are a total 13 bond ETFs and Nippon India ETF Liquid BeES is the oldest.

One can invest in Nifty BeES through their trading and demat account. Just like purchasing equity securities (stock), one can buy Nifty BeES. Unit holders can buy and sell anytime during the trading day at the prevailing market prices.

This can be bought and sold like an ordinary stock on NSE and as it tracks NIFTY S&P CNX Index, it gives you a chance to trade intraday as well as providing you with the real-time NAV.

Comparing NIFTY 50 ETFs and NIFTY 50 Index Fund

Let's look at their expense ratio and their tracking error too. From the above tables, Nippon India ETF NIFTY 50 BeES has a lower tracking error, lower expense ratio, and slightly higher returns. So, are ETFs an obvious choice over NIFTY 50 Index funds?

There is no entry or exit load as this fund is traded on the secondary market. Charges for Liquid BeES and Liquid ETFs are as follows: Transaction charges of 0.00345% for NSE and 0.00375% for BSE on turnover (qty * price). 18% GST on the transaction charge.

Low cost: Nifty BeEs has a low expense ratio compared to actively managed funds. This cost-efficiency is beneficial for long-term investors as it minimizes the impact of expenses on overall returns.

Dividend Policy of Nippon India ETF Nifty BeES

The dividend is paid to the unitholder after deducting the applicable taxes at source. The dividend is typically distributed within 30 days from the date of declaration of the dividend.

What is the price of Nifty BeES option? ›

What are the OTM (out-of-the-money) strikes of Nip Ind Etf Nifty Bees Industries? All call option strike prices above spot price are OTM and all put option strike prices below the spot price are OTM. Currently, the spot price of Nip Ind Etf Nifty Bees Industries share is ₹204.46.

1. Current NAV: The Current Net Asset Value of the Nippon India ETF Nifty 50 BeES as of Jun 15, 2023 is Rs 205.33 for IDCW option of its Regular plan. 2. Returns: Its trailing returns over different time periods are: 13.87% (1yr), 24.1% (3yr), 12.77% (5yr) and 15.39% (since launch).

Taxation of Nifty BeEs

However, if you continue to hold the same investments for a prolonged period, i.e., more than a year, the earnings from them are taxed at 10 per cent, sans the indexation benefit."

You need a Demat account and trading account to complete the investment. According to the prevailing market rates, you can buy or sell Nifty BeES at any time of the day (trading hours). You can invest in Nifty BeES through SIP or a lumpsum plan.

Short selling means selling shares that the investor does not own like the shares borrowed from a brokerage. Although short selling is applicable for ETFs, it is not possible to short sell Nifty BeEs. Can I buy nifty for long term? Yes, you can buy Nifty for the long term through ETFs.

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