Pacer launches ActiveAlpha India Quality ETF (INDQ)

Pacer ETFs has launched the Pacer ActiveAlpha India Quality ETF (INDQ) in partnership with Mumbai-based index provider ActiveAlpha. The U.S.-listed fund provides concentrated, factor-driven exposure to Indian equities.

The ETF applies a rules-based process that combines quality, value and momentum screens. It starts with a broad universe of Indian stocks and narrows the list to roughly 25 to 30 companies. The portfolio is sector agnostic and prioritizes individual security characteristics over sector weightings.

ActiveAlpha’s selection criteria have been used for about 12 years, according to Pacer. The firm says the method blends systematic screening with active judgment to produce a compact basket of companies while keeping the process transparent and rules-based.

Bruce Kavanaugh, Pacer’s executive vice president and head of investments, noted the firm manages $39.8 billion across 64 funds and cited the Cash Cow lineup, which focuses on free cash flow strategies, as a firm feature. He pointed to stronger performance and asset flows in Pacer’s international and emerging market Cash Cow products this year.

Kavanaugh added, “We thought the India fund was the perfect complement to add to our international suite as India continues to stand out as one of the strongest growth stories globally and this was an opportunity to work with a local adviser who has a track record in investing in India securities.” He said ActiveAlpha’s process of screening a broad index and identifying 25–30 companies based on quality, value and momentum aligns with Pacer’s investment approach.

Pacer cited India’s young, consumer-oriented population, ongoing economic reforms and large public spending on industrial and digital infrastructure as factors that support long-term growth. The firm noted India moved from the world’s 10th to fifth-largest economy over the past decade and said some forecasts project it could reach third place in the near term.

Pacer indicated it may apply ActiveAlpha’s screening process to other segments of the Indian market in the future. INDQ joins a growing set of U.S.-listed products that use rules-based and factor-informed strategies to provide exposure to India.