We examine the influence of country exchange traded funds (ETFs) on the country’s stock market indices, irrespective of their underlying benchmark. A pooled ordinary least square (OLS) analysis of a sample of 28 India ETFs listed in the US, UK, Canada, France, Japan, Israel and Singapore reveals that India ETFs have a significant impact on the country’s stock indices. We also document reverse causal dynamics between country ETFs and the country’s stock indices. The results are robust even after controlling for global effects, stock market volatility, foreign institutional investor (FII) flows, foreign exchange rate and asset size of India ETFs. The findings of the study have implications for global investors and policymakers in both emerging and developed markets. Policymakers would find it compelling to monitor country ETFs’ fund flows into the underlying country, as withdrawal of country ETFs could have a cascading effect on the economy. JEL Classification: G11, G15, G23

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国家ETF是否会影响外国股票市场指数？来自印度ETF的证据

我们研究了国家外汇交易基金（ETF）对国家股票市场指数的影响，无论其基准是什么。对在美国，英国，加拿大，法国，日本，以色列和新加坡上市的28种印度ETF样本的汇总普通最小二乘（OLS）分析显示，印度ETF对该国的股票指数具有重大影响。我们还记录了国家ETF与国家股票指数之间的反向因果关系。即使在控制了全球影响，股票市场波动，外国机构投资者（FII）流量，汇率和印度ETF资产规模之后，结果仍然是可靠的。该研究的结果对新兴市场和发达市场的全球投资者和政策制定者都有影响。决策者会发现，监视国家ETF流入底层国家的资金引人注目，因为撤回国家ETF可能会对经济产生连锁反应。JEL分类：G11，G15，G23