Key Points
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India's economy is projected to grow by 6.6% in fiscal 2027 and could be buoyed by a potential trade agreement with the U.S. government.
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While accessing individual Indian stocks can be tricky for U.S. investors, India-focused ETFs make building exposure much more straightforward.
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EPI, SMIN, and INDH offer varying strategies that may appeal to different investors seeking to bulk up their exposure to Indian equities.
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Interested in WisdomTree India Earnings Fund? Here are five stocks we like better.
The United States and India are continuing negotiations toward an agreement aiming at a trade target of $500 billion by 2030, although as of mid-April 2026, no official deal has been reached. Benefits of an agreement of this kind could include lower U.S. tariffs on Indian goods and increased flows of industrial, agricultural, and tech products, among others.
Without a deal in hand, investors anticipating that the two governments will reach an agreement may still have time to firm up positions in companies poised to benefit if negotiations reach a positive outcome. A mutually beneficial trade arrangement may help to further boost India's economy—despite an anticipated slowdown due in part to the price of oil amid the Iran war, the most populous country in the world is forecast for 6.6% economic growth in fiscal 2027. As a result, Indian companies could gain additional momentum.
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While it can be difficult for U.S. investors to access individual Indian equities, exchange-traded funds (ETFs) focused on the country may be one of the easiest ways to gain exposure to the broader market.
An Earnings-Weighted India Fund Focuses on Profitability
The WisdomTree India Earnings Fund (NYSEARCA: EPI) offers broad exposure to about 350 Indian stocks, but what makes the fund stand out is its avoidance of common market-capitalization-weighting methods. Rather, EPI weights its holdings by earnings, a bid that may help to ensure its portfolio is maximally profitable compared to the broader Indian equities space, and that it offers investors access to smaller firms and not just big companies.
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The result is a fund with a handful of those several hundred positions that each represent 5% or more of the portfolio, so EPI's broad basket does not necessarily mean that it doesn't lean toward a smaller number of companies in the end. The fund's unique weighting approach and specialized international focus mean that its expense ratio is on the high side at 0.84%.
However, for a well-rounded approach covering substantial portions of India's financials, energy, materials, and industrials sectors, among others, EPI can be a strong contender. Its one-year return is -4%, although it has climbed by about 4% in the past month alone.
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Pure-Play Exposure Via a Small-Cap Strategy
In a booming economy, small-cap names may have enhanced growth potential, and the iShares MSCI India Small-Cap ETF (BATS: SMIN) targets just this segment of the Indian equities market. SMIN holds hundreds of small-cap names across virtually all sectors, for true breadth of exposure to Indian stocks. Because the largest position in SMIN's portfolio occupies only 1.7% of invested assets, there may be less danger with this fund of overweighting toward certain individual companies as compared with EPI or other India-focused ETFs.
On top of this, for an expense ratio of 0.74%, SMIN also provides a dividend yield that may appeal to investors seeking to balance the small-cap segment's volatility with steadier income. Indeed, that volatility has been on display in just the last year: SMIN is down almost 4% over the past 12 months, but has surged upwards by 10% in the last month alone.
If a targeted focus on India's small-cap segment is too narrow for investors, iShares has designed SMIN to be a complement to its much larger large-cap India play, the iShares MSCI India ETF (BATS: INDA). The latter of these funds has a smaller portfolio that is more heavily concentrated in a select group of major Indian companies, including Reliance Industries Ltd. and Infosys Ltd. (NYSE: INFY). With an expense ratio of 0.61%, INDA is also among the least expensive ETFs with a focus on the Indian market available to U.S. investors.
An Alternative Approach: Equities Exposure With a Currency Hedge Overlay
An investor keen to build exposure to India amid the possibility of a major new trade agreement but nervous about the impact of currency fluctuations might look to the WisdomTree India Hedged Equity Fund (NASDAQ: INDH).
INDH has a much narrower portfolio than EPI, despite being offered by the same fund provider, and consequently is fairly heavily concentrated among top positions. The benefit of INDH in spite of this concentration, though, is its effort to use a currency hedge strategy that minimizes the impact of fluctuations between the dollar and the Indian rupee.
INDH may be a somewhat more conservative India ETF, but its expense ratio doesn't necessarily reflect its specialized approach: the fund has an annual fee of just 0.64%, placing it just above INDA.
The article " 3 ETFs to Own If a U.S.-India Trade Deal Succeeds (Plus a Bonus) " was originally published by MarketBeat.
