Navi MF's move to launch Nifty 50-based index fund at 0.06% had stoked fears of price war
NFO for Navi Nifty 50 Index Fund opens July 3; scheme will have expense ratio of just 0.06% under the direct plan and 0.26% under regular plan which is bought through an intermediary
The difference now is that investors have poured billions of dollars into products tracking smaller and cheaper stocks in the past six months
The funds are focused on the Nitfy midcap and smallcap indices
With just three or four passive products, you can build a solid, long-term portfolio
Fifteen of the 16 debt categories have beaten diversified equity funds over a three-year period, data shows
These products, however, carry higher risk than a pure passive fund
Last month, Index funds received inflows to the tune of Rs 2,076 crore, as against Rs 511 crore the previous month
Use two criteria for selecting an index fund. One is expense ratio, another criterion you should use is tracking error
With active funds finding it increasingly difficult to beat their benchmarks, it is time for investors to have a significant allocation to passive strategies
The purpose of the new rules is to ensure that passive funds remain adequately diversified
Bogle took a complex universe of thousands of stocks and reduced it to a simple, singular entity, the index fund
Actively managed ones give better returns in an emerging economy
Only if you are a conservative investor satisfied with index returns; but over long term actively managed funds give better returns in Indian markets