Sectoral ETFs let you bet on a specific industry — banking, IT, pharma, defence — without picking individual stocks. ETFBharat tracks 12 sectors with full holdings and AUM data.
Browse Sectoral ETFs →Sectoral ETFs are inherently cyclical — their returns depend heavily on the macroeconomic phase. Banking ETFs perform best during rate-cut cycles when NIMs expand. Metals ETFs do well during global commodity super-cycles. IT ETFs are defensive in domestic slowdowns (USD revenues) but suffer during global tech slowdowns. Defence ETFs benefit from sustained government capex regardless of economic cycle. Map the sector to the current and expected macro environment before investing.
Sectoral ETFs have higher expense ratios (0.15-0.60%) than broad-market ETFs (0.04-0.10%). Since you're expressing a tactical view, limit sectoral ETF allocation to 5-15% of your portfolio. Check the average daily volume — thin volumes create wide bid-ask spreads that erode returns. BANKBEES and ITBEES have volumes of ₹100 Cr+ daily; some niche sectoral ETFs trade as low as ₹2-3 Cr daily.