Three years in, INQQ continues to ride the wave of India’s digital revolution—offering investors a front-row seat to one of the fastest-growing internet economies in the world.
Three years ago, the India Internet ETF (INQQ) was launched with a vision: to provide investors access to the rapidly growing, yet underrepresented, digital economy of India. Today, as we celebrate the third anniversary of INQQ, we reflect on its journey and the significance of investing in India's internet sector.
Why India? Why Now?
India represents one of the most compelling growth stories in the world. With a population of over 1.4 billion, a median age of just 28, and a rapidly expanding middle class, the country is experiencing an unprecedented digital revolution. The combination of increasing smartphone penetration, affordable data costs, and a thriving startup ecosystem makes India a frontier for investors looking for long-term technological trends.
INQQ was created to capture this transformative shift. By focusing exclusively on internet and e-commerce companies operating in India, it offers exposure to a sector poised to define the country’s economic future.
What INQQ Does
INQQ provides investors with targeted exposure to India's burgeoning internet economy by investing in companies across various sectors, including:
- Internet Services: Companies offering online services such as search engines, social networks, and online advertising platforms.
- Internet Retail: E-commerce platforms are transforming the retail landscape by enabling online shopping experiences.
- Digital Payments & Fintech: The rise of cashless transactions and fintech innovation, including mobile wallets, online banking, and digital lending platforms
- Internet Broadcasting & Media: Platforms delivering digital content, including streaming services and online news outlets.
- Online Travel: Companies facilitating travel bookings and related services through online platforms.
- Online Gaming: Firms developing and distributing games accessible via the internet.
The Untapped Potential of India's Digital Economy
Despite India's enormous digital expansion, it remains relatively underrepresented in global investment portfolios. [1] Many investors looking for emerging market exposure traditionally focus on China or broader indices that may not fully capture the opportunity in India’s standalone internet ecosystem.
India’s e-commerce market alone is expected to surpass $325 billion by 2030, fueled by rising consumer demand, improved logistics, and government initiatives like Digital India and UPI (Unified Payments Interface), which have accelerated financial inclusion. [2] As more Indian companies go public, INQQ is positioned to offer exposure to these innovators.
Looking Ahead: The Future of INQQ
As we celebrate three years of INQQ, the outlook for India’s internet economy remains as bright as ever. With improving infrastructure, increased digital adoption, and continued innovation, the sector is poised for expansion. Whether you are an institutional investor or an individual looking to diversify into emerging markets, INQQ may provide an efficient way to gain exposure to one of the world’s most dynamic digital landscapes.
Here’s to many more years of opportunity with the India Internet ETF (INQQ)!
To learn more visit emqqglobaletfs.com.
[1] Heugh, Kristian et al. The India Opportunity, Opportunity Optimum, Morgan Stanley Investment Management, 1/2024
[2] Nandan, Navneeta, India's e-commerce market to reach $325 bn by 2030: Deloitte, The Economic Times, 10/7/24
INQQ Disclosures
Carefully consider the Fund’s investment objectives, risk factors, charges and expenses before investing. This and additional information can be found in the Fund’s prospectus, which may be obtained by visiting www.emqqglobaletfs.com. Read the prospectus carefully before investing.
Market price returns are based on the official closing price of an ETF share or, if the official closing price isn’t available, the midpoint between the national best bid and national best offer (“NBBO”) as of the time the ETF calculates current NAV per share. NAVs are calculated using prices as of 4:00 PM Eastern Time. The returns shown do not represent the returns you would receive if you traded shares at other times. Shares of ETFs are bought and sold at market price (not NAV) and are not individually redeemed from the funds. Brokerage commissions will reduce returns.
Risk Information
Investing involves risk, including the possible loss of principal. Investments in smaller and mid-sized companies typically exhibit higher volatility. The funds are non-diversified. International investing may involve risk of capital loss from unfavorable fluctuations in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well as increased volatility and lower trading volume. Frontier markets generally have less developed capital markets than traditional emerging market countries, and, consequently, the risks of investing in foreign securities are magnified in such countries. These countries are subject to potentially significant political, social and economic instability, which could materially and adversely affect the companies in which the Fund may invest. The Fund invests in the securities of Internet Companies, including internet services companies and internet retailers, and is subject to risk that market or economic factors impacting technology companies and companies that rely heavily on technology advances could have a major effect on the value of the Fund’s investments.
Additional Risk Information for INQQ
Investing in India may involve the risk of capital loss from unfavorable fluctuations in currency values, from differences in generally accepted accounting principles, or from economic or political instability in India as well as increased volatility and lower trading volume. Certain restrictions on foreign investment may decrease the liquidity of the Fund’s portfolio, subject the Fund to higher transaction costs, or inhibit the Fund’s ability to track the Index. The Fund’s investments in securities of issuers located or operating in India may be limited or prevented, at times, due to the limits on foreign ownership imposed by the Reserve Bank of India (“RBI”).
The Fund is registered as a foreign portfolio investor (“FPI”) with the Securities and Exchange Board of India (“SEBI”) in order to have the ability to make and dispose of investments in Indian securities. There can be no assurance that the Fund will qualify or continue to qualify as an FPI, or that the Indian regulatory authorities will continue to grant such qualifications and the loss of such qualifications could adversely impact the ability of the Fund to make and dispose of investments in India.
There is no guarantee that the Funds or the index will achieve its investment objective.
Exchange Traded Concepts, LLC serves as the investment advisor, and Penserra Capital Management LLC serves as a sub advisor to the EMQQ ETF. Exchange Traded Concepts, LLC serves as the investment advisor for FMQQ ETF and INQQ ETF. The Funds are distributed by SEI Investments Distribution Co. (SIDCO) 1 Freedom Valley Drive, Oaks, PA, 19456, which is not affiliated with Exchange Traded Concepts, LLC or Penserra Capital Management LLC.
Important Disclosures
Exchange Traded Concepts is an SEC Registered Investment Adviser. The Firm's Form ADV is publicly available and can be found here: https://www.adviserinfo.sec.gov/Firm/151197. ETC may be subject to various conflicts of interest in the provision of its services. Potential conflicts of interest shall be identified in the Firm's Form ADV. The Exchange Traded Funds are referred to as "Funds" for purposes of this document. ETC transacts business in the United States and other jurisdictions where it is properly registered or excluded or exempted from registration requirements. This document does not constitute an offer of services in jurisdictions where ETC does not have the necessary licenses.
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