![]() That’s exactly we will cover in this article. However, when it comes to passive investing there are two options available to investors – ETFs and Index Funds.īut, is one better than the other? If yes, then which one? % of active small-cap funds underperforming the Nifty Smallcap 250 % of active mid-cap funds underperforming the Nifty Midcap 150 % of active large-cap funds underperforming the Nifty 100 Most Active Funds Fail To Beat Their Benchmarks ![]() So, underperformance by active funds possibly significantly boosted passive funds. And even though just 13% of small-cap funds didn’t beat the benchmark in 2022, this number was quite high in the preceding two years. For mid-caps % of funds underperforming was 55%. Now, there are many reasons responsible for the rise of the passives, including their low cost, low maintenance, and wider suitability, but one reason that stands out is their active counterparts’ underperformance.Ī look at the percentage of funds underperforming the Nifty 100, Nifty Midcap 150, and Nifty Smallcap 250 indices will give you an idea.Īs you can see, in 2022, nearly 67% of active large-cap funds underperformed the Nifty 100. ![]() By 2022-end, they grew to 6.36 lakh crore, a jump of over 400% in just 5 years. It shows the assets of passive funds – ETFs, index funds, and funds of funds or FoFs.Īt the end of 2018, the assets of passive funds stood at Rs 1.22 lakh crore. It’s no news that the popularity of passive investing is on the rise.
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