In this article, I’ll guide you in finding the Best Nifty 50 index fund in india 2024 that suits your needs. Before that understand what is index fund and how it works. An index fund is an investment vehicle, either a mutual fund or an exchange-traded fund (ETF), that tracks a specific collection of stocks, or an index. The goal of the fund managers is to mirror the index’s performance without engaging in active management, whether they develop the index themselves or use one provided by an external company, like an investment bank or brokerage. These funds typically follow well-known indexes, often cited in financial news as benchmarks of market performance, offering investors a broad view of how the overall stock market is doing.
Best Nifty 50 index funds in india 2024:
Some of the least expensive index funds available for purchase and sale on open markets are included in the list below, which tracks a widely diversified index and comprises funds from a number of different companies. One of the key determinants of your overall return when investing in index funds is cost:
Best Nifty 50 index funds
The Nifty 50 is one of the most widely-followed stock market index in the world and there are many funds that invest based on the index.
Nippon India Index Fund Nifty 50 Plan Direct – Growth:
The Nippon India Mutual Fund offers a Large Cap Index mutual fund scheme called Nippon India Index Fund Nifty 50 Plan Direct – Growth. This fund was established on January 1, 2013, making it 11 years and 7 months old as of June 30, 2024. Nippon India Index Fund Nifty 50 Plan Direct -Growth had assets under management (AUM) of ₹1,796 crores, making it a medium-sized fund in its category. The fund has an expense ratio of 0.2%, which is close to what most other Large Cap Index funds charge.
The Nippon India Index Fund Nifty 50 Plan Direct has yielded growth returns of 25.11% over the past year. It has generated 13.83% average annual returns since launch. Every four years, the fund has doubled the amount invested in it.
Exit Load: Exit load of 0.25% if redeemed within 7 days
Expense ratio: 0.2% as on Jun 30, 2024
AUM (Fund size): ₹1,796 Crs
Lock-in: No Lockin
HDFC Index Fund Nifty 50 Plan Direct -Growth:
Exit Load:Exit load of 0.25% if redeemed within 3 days
Expense ratio:0.2% as on Jun 30, 2024
AUM (Fund size):₹16,592 Crs
Lock-in: No Lockin
ICICI Prudential Nifty 50 Index Direct Plan Growth:
Exit Load: Nil
Expense ratio: 0.17% as on Jun 30, 2024
AUM (Fund size): ₹9800.42 Crs
Lock-in: No Lockin
SBI Nifty Index Direct Plan-Growth:
Exit Load:Exit load of 0.20% if redeemed within 15 days
Expense ratio: 0.2% as on Jun 30, 2024
AUM (Fund size): ₹7941 Crs
Lock-in: No Lockin
Tata Nifty 50 Index Direct:
Exit Load: Exit load of 0.25% if redeemed within 7 days
Expense ratio: 0.2% as on Jun 30, 2024
AUM (Fund size): ₹811 Crs
Lock-in: No Lockin
Index funds have become increasingly popular in India due to several advantages over traditional actively managed funds. Although many investors still prefer actively managed funds for their potential to deliver returns higher than the benchmark index, here are three key reasons why index funds are gaining traction in India:
No Fund Manager Needed
In an index fund, the fund manager’s role is to simply replicate the performance of the index being tracked, eliminating any bias in stock selection. For example, an index fund tracking the NIFTY Next 50 Index will only invest in the 50 stocks that make up this index. Additionally, the weight of each stock in the index mutual fund will match its proportion in the NIFTY Next 50 Index. Since the fund manager doesn’t need to make individual stock selections or time market entry and exit points, there is no risk of personal bias influencing investment decisions.
Low Cost of Investment
Managing even a top-performing index fund requires less effort than an actively managed equity mutual fund, as there’s no need for a team of analysts to research the best investment opportunities or predict market trends. This results in lower management costs for index funds. Additionally, because index funds do not engage in frequent trading, they have lower portfolio turnover, leading to a lower expense ratio compared to actively managed funds.
Diversified Investments
Indices generally consist of a broad range of stocks spread across multiple sectors, with limits on the exposure to individual stocks. Since an index mutual fund’s portfolio mirrors the chosen index, these funds offer investors diversified investments across different sectors, minimizing concentration risk. Actively managed funds often struggle to achieve this level of diversification at such low costs.
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