Top 10 Index Funds.
5paisa Research Team
9th December 2022 - 09:20 am
Passively managed funds such as Index funds are gaining momentum. Read on to find the detail about index funds that track the frontline equity index, Nifty 50.
Investors who are not well versed with equity investment, however, want to benefit from the equity investment can opt for index funds. According to data from the Association of Mutual Funds in India (AMFI), Asset under management (AUM) surged almost three times during in last year. AUM at the end of September 2021 stood at Rs 33824 crore against Rs 12581 crore the same month last year. Although most of the investment comes in schemes that replicate indices such as Nifty 50 and S&P BSE Sensex, others are also gaining ground now. So you will find index funds imitating mid-cap and small-cap indices also.
Given this popularity, Navi AMC recently launched the cheapest Nifty 50 index fund that has an expense ratio of 6 basis points. Besides expense ratio what is also important before selecting an index fund is tracking error. Tracking error is the difference in actual performance between the fund and its corresponding benchmark. So even if the index fund has a very low expense ratio, and a higher tracking error, it may not solve the purpose of investing in index funds. Hence, it is important to look at both expense ratio and tracking error before committing your fund to an index fund.
Below table shows the index funds that track Nifty 50 and is sorted based on tracking error.
This is the table code -
|
Name |
Expense Ratio |
Tracking Error |
AUM in Cr |
NAV (Rs) |
|
SBI Nifty Index Fund |
0.17% |
0.10% |
1530 |
160.28 |
|
HDFC Index Fund-NIFTY 50 Plan |
0.20% |
0.10% |
4000 |
167.79 |
|
UTI Nifty Index Fund |
0.20% |
0.11% |
5216 |
120.46 |
|
DSP Nifty 50 Index Fund |
0.21% |
0.13% |
122 |
16.3 |
|
ICICI Prudential Nifty Index Fund |
0.17% |
0.14% |
2160 |
181.37 |
|
IDFC Nifty Fund |
0.16% |
0.15% |
357 |
38.22 |
|
L&T Nifty 50 Index Fund |
0.25% |
0.16% |
80 |
20.28 |
|
Aditya Birla Sun Life Index Fund |
0.34% |
0.18% |
257 |
179.19 |
|
LIC MF Index Fund – Nifty Plan |
0.49% |
0.18% |
50 |
103.22 |
|
Nippon India Index Fund – Nifty Plan |
0.20% |
0.20% |
420 |
31.59 |
|
Franklin India Index Fund – NSE Nifty Plan |
0.26% |
0.20% |
458 |
146.78 |
|
Tata Index Fund – Nifty Plan |
0.19% |
0.21% |
200 |
116.68 |
|
Motilal Oswal Nifty 50 Index Fund |
0.10% |
0.30% |
105 |
14.91 |
|
IDBI Nifty Index Fund |
0.16% |
0.67% |
220 |
35.38 |
|
Kotak Nifty 50 Index Fund |
0.20% |
0.67% |
91 |
11.4 |
The above table shows that though, Motilal Oswal Nifty 50 Index Fund has the lowest expense ratio, it has a higher tracking error. Hence, the best combination is the fund that has lower expense and tracking error.
Tanushree Jaiswal