Fund houses line up several passive offers, according to Amfi data


Passive funds have experienced significant inflows in recent months, with “new-age” investors favoring low-cost products over active funds. To exploit the opportunity of index funds and exchange-traded funds (ETFs), fund houses have implemented several products for investors.

Data from the Association of Mutual Funds of India (Amfi) shows that between June and November, ETFs and index funds collectively recorded net inflows of around Rs 52,500 crore.

On Monday, ICICI Prudential Mutual Fund (MF) and Nippon India MF launched “Auto ETF”. Navi MF has launched Navi Nifty Next 50 Index Fund, a variable share program that will replicate the Nifty Next50.

With an expense ratio of 0.12% for the direct plan, Navi Nifty Next 50 Fund will have the lowest cost compared to similar programs in the passive fund category.

The ICICI Prudential Mutual Fund Automotive ETF, namely the ICICI Prudential Nifty Auto ETF, aims to provide returns that closely match the total return of the benchmark Nifty Auto, subject to tracking errors. Even Nippon India MF announced the launch of Nippon India Nifty Auto ETF.

Chintan Haria, Head of Product Development and Strategy, ICICI Prudential Mutual Fund, said: “We believe that through ICICI Prudential Nifty Auto ETF, investors will be able to tap into the evolving space of India’s automotive industry.

With India being an emerging global hub for the supply of automotive components, coupled with government support for electric mobility, we believe this space is likely to be in the spotlight.

Market participants say passive investing will increase even in the current calendar year as several funds plan to offer ETFs or index funds.

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