Section 1 · Passive vs Active
Why do passive funds exist?
Most active fund managers fail to consistently beat the market after fees. Passive funds skip the manager entirely — they just copy an index mechanically, keeping costs near zero.
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Passive / Index Fund
✅Automatically copies an index — Nifty 50, Sensex, Midcap 150, etc.
✅Fees as low as 0.05–0.2% per year
✅You get exactly what the market gives — no more, no less
💡The only skill required: picking the right index for your goal
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Active Fund
⚠️Fund manager handpicks stocks — can beat the market, or badly miss it
⚠️Fees of 1–2% per year, whether or not the manager adds value
✅Worth it only in specific categories where skill shows up consistently
💡See the Active Funds page to find which categories are worth paying for
View Active Funds →📖 The only two things that matter in a passive fund
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Tracking Difference (TD)
How closely it copies the index
If the Nifty 50 returned 12% and your fund returned 11.4%, tracking difference is -0.6%. Lower absolute TD = better execution. Target funds with TD below 0.5% over 3 years.
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AUM (Fund Size)
How much money is in the fund
Larger AUM means better liquidity, tighter bid-ask spreads for ETFs, and lower operational costs per unit. Aim for funds with at least ₹500 Cr AUM for ETFs.
Section 2 · Where to Look
Which index should I pick?
Start with what kind of exposure you want — large cap, mid cap, international, sector — then pick the best tracker for that index. Here's a simple framework.
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Large Cap (Core)
Nifty 50, Sensex, Nifty 100. Lowest risk, most liquid, great starting point for first-time investors. Match with Nifty 50 index funds.
✅ Suitable for beginners
🔺
Mid & Small Cap
Nifty Midcap 150, Smallcap 250. Higher long-term returns historically but more volatile. Good for long horizons (7+ years).
⚠️ Higher volatility
🌍
International / Thematic
US indices (S&P 500, Nasdaq), gold, sectoral. Adds diversification. Use only as a satellite allocation.
💡 Diversification tool
⚡
Factor / Smart Beta
Momentum, Quality, Value, Low Volatility. More targeted bets. Useful once you understand regular index funds well.
🧠 Advanced
Which benchmarks are tracked most precisely?
Average tracking difference (3Y) per benchmark. Shorter bar = tighter tracking = less leakage.
Below 0.5% — Excellent tracking
0.5–1.5% — Acceptable
Above 1.5% — High leakage
Section 3 · Benchmark Scoreboard
Every index — compared by tracking and scale
Each row is an index. See how many trackers exist, the best tracking difference achieved, and average returns. Good starting filter: pick rows with low Median TD and high Total AUM.
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Tightest tracking (3Y)
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TD: — ·
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Best benchmark avg TD
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Avg TD: —%
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Largest index by AUM
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₹0 Cr total AUM
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Median tracking diff
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Industry-wide median (3Y)
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Indices with trackers
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0 passive funds total
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Important Disclaimer: This data is for informational purposes only and does not constitute investment advice. Past performance is not indicative of future returns. All data sourced from AMFI, updated daily. Read all scheme-related documents and consult a SEBI-registered advisor before investing.