How US MFs specialising in India are faring

Last Updated: Mon, May 21, 2012 08:52 hrs

Long-term growth prospects in India are drawing the attention of mutual fund companies in the U.S. Ten U.S. funds specialize in Indian stocks, and half of those have been launched over the past year and a half. The number of exchange-traded funds focusing on India has also grown to 10, and most are less than two years old.

That growth led Morningstar Inc. to create a new category for India stock funds this month. Previously, they were part of a broader category of funds that invest across many countries in Asia and the Pacific, excluding Japan. The creation of a new category makes it easier to find and compare India funds.

Anyone considering a fund focusing on a single foreign market should know the risks can be much higher than investing in a diversified U.S. stock fund, or an international stock fund investing in several countries.

Here are the funds in Morningstar's India Equity category, listed in order of total assets in each fund, and the average investment returns for the group:

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