Hey Saurabh, not yet, we are still awaiting clarity on this.
As i understand insta redemption is allowed only in Overnight & Liquid Funds.
Hey Supriyo, thanks so much for the wishes & the suggestions. Most of the suggestions you have made have a lot of merit and we are already working on few of them wherever its regulatory possible.
Any updates/details on TER? Zerodha is a passive only fund house similar to the world famous vanguard but your TER is 5-6x that of typical vanguard TER. I concede that they do have crazy AUM that ZFH doesnât yet have.
But even in India, Edelweiss has lower expense ratio on its LM250 fund with lower AUM as compared to ZFH.
Also if ZFH wants to make its funds mainstream it has to be able to compete with Nifty 50 expense ratios which have gone down to 0.06 levels in mutual fund space as well.(NAVI Nifty 50)
@VishalJain
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I heard that Zerodha is launching passive multi asset fund. What about passive hybrid funds ?
Hey Anil, we are still awaiting clarity on the what debt indices are eligible to be used for passive hybrid.
Hey, i have answered this question a number of times on this forum and that one should base their decisions not only on TER but also on other paramters such as tracking error and tracking difference which would give a better picture about any passive scheme. A low TER does not ensure that fund is being managed well as in most fund houses where active and passive is managed together, its just another product in the suite. In addition, our focus is on retail investors and you will agree that for any business the cost dynamics of a pure retail biz vs one where the focus is institutional i.e. mixed is very different. Despite this, our products are competitively priced and have ensured least variability in TER as compared to others. It goes without saying that as we keep growing and the business metrics reach sustaninability, we will pass those benefits to investors whereever & whenever we can. Hope this clarifies.
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Hi @VishalJain
hopefully, by now,
the recurring queries along the lines of
âwhy the expense-ratio of a passive fund being offered by Zerodha Fund House (ZFH) is noticeably higher than similar offerings by competitors!?â
is sufficient feedback to ZFH that
a. The offering(s) in question are not sufficiently differentiated from competitorsâ offerings.
- You having to individual point out the differentiating aspects out each time, is a sign that the promotional materials and documentation are failing to do so effectively. Especially in terms potential customers understand.
b. When evaluating multiple offerings that vary in multiple aspects, users continue to value a single number to compare the available options, and decide to pick one of them. If you believe TER doesnât do justice in highlighting the overall, please consider âchanging the conversationâ (as much as the regulations permit) in the marketing/documentation to focus upon and highlight/promote a single alternative number (or if regulations do not permit, then an additional number) that clearly/objectively captures/reflects the additional factors that ZFHâs offerings are significantly better at (compared to the competitors).
The irrational consumer behavior demonstrated by folks continuing to prefer lower TER passive ETF/funds, even when such funds are worse in other aspects, appears to be a real-life example of the long-known predictable outcome described in Amos Tverskyâs paper from 1969 titled âIntransitivity of Preferencesâ.
Basically,
If the other aspects (where ZFHâs funds are supposedly superior),
are not clear, obvious, and significantly better,
then in terms of those factors, consumers will mentally classify ZFHâs offerings into the same bucket as the competitorsâ offerings.
Subsequently, TER, the remaining factor that can be clearly and objectively compared, and has a significant difference (in favor of the competitors), will end-up being the deciding factor when choosing a passive ETF/fund, however irrelevant such a TER might be.
The fact that fund houses offering a mix of both active and passive funds, can undercut ZFH on the TER of passive funds, is of no relevance to the consumer looking for a passive ETF/fund to invest in. Unless it can be clearly demonstrated to the consumer, how such a policy being pursued by the competitors is NOT in the consumerâs own best interests over the long-term.
(PS: The above thoughts are ramblings of a ârandoâ on the internet who has recently read the works of Daniel Kahneman. If one has a hammer, everything looks like a nail. If youâve already thought of this âirrational consumer behaviourâ and have something in store to fix this, then cheers 
)
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@VishalJain Top100case stocks = niftybees + juniorbees stocks( or nifty 50 + nifty next 50 stocks), is my understanding correct?
Thats correct.
Hello Vishal Ji @VishalJain
Can you please answer my queries on Zerodha Nifty 1D Rate Liquid ETF
- In the factsheet it says creation unit size is 5000. I want to create say 10K units , can you please guide me on how to do it directly with AMC
- Is there any STT / other govt charges levied while creating the units directly with AMC? If yes, please let me know.
- Can you pls explain once units are created, how can I get them transferred to my CDSL demat a/c which I have with HDFC sec so that I can use them for pledging/margin.
- In future when I redeem those 10k units , is it possible to do it directly with AMC?
- Final question regarding return expectation- what is the yield currently on the âZerodha Nifty 1D Rate Liquid ETFâ . The theoretical return that I should get if hold for say 1 year :
Yield - Expense ratio (0.27%) - Tracking error (0.02%)
Is my understanding correct?
If I do it via exchange then the return will go down by impact cost (during buy & Sell) and other charges (exchange turnover/sebi charges etc)
Thanks in advance!
Hi Vishal, do you know why MID150CASE and TOPCASE are not in the pledeable ETFs list yet? Is some regulatory check missing?
Hi Vishal, team Zerodha is doing a wonderful work and I express my gratitude to be on board with Zerodha. Recently, I participated in your new NFO. Just wish to know like in other AMCâs is there any way to get account statement of units purchased/sold ? Thank you
Is this liquidcase or something else
Hey Yash, as per SEBI guidelines, in ETFs direct subscriptions/redemptions with the AMC are allowed for sizes greater than Rs.25crores. Only registered market makers can create/redeem in sizes less than Rs.25 crores in creation unit size. As the underlying investment of the scheme is in one day maturing TREPS therefore the returns of the scheme resembles the TREPS market rate which is currently hovering in the range of 5.1% - 5.2% reduced by the TER 0.27% and tracking error, difficult to predict returns for a year as TREPS has only one-day maturity. Your understanding about impact cost and other charges are correct. However, you could look at putting your quotes mid-way between the best bid & offer, we see decent volumes happening there as well.
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Hey Anil, recently there have been some regulatory changes due to which exchanges have prescribed a criteria for any security that they accept for margin placement based on factors like impact cost, liquidity norms, etc. Due to this, a large number of existing ETFs & products came out of the margin security list and most new ones will take time to meet the criteria. Exchanges monitor and update the margin security list every month.
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Thanks.
Hey Payal, would want to understand if you hold the units in Demat or SOA (physical) mode.
Since you have not mentioned the mode of holding (demat / SOA) listed below are 3 ways you can get an account statement.
-
If you hold units in demat mode - you can get the statement from your registered platform (broking platform) used for the initial transaction.
-
If you hold units in SOA mode:
a. you can email us at [email protected] and we shall trigger the statement for you on your registered email id
b. you can self trigger a statement to your registered email id from this link
Hope this helps.
Thank You so much for the wishes and being an investor with us. Its these good words that help us to keep doing more.
Hi Vishal, any plan to launch Smallcap ETF?
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