Beyond Nifty 50: 5 Passive Funds Changing Your SIP

Passive investing in India has grown far beyond plain Nifty 50 index funds. Today you can invest in sector, factor, and thematic index products. Here is what this means for your SIP and long-term portfolio.

Here's what happened: Indian passive fund assets have grown sharply, with over 350 index fund and ETF schemes now available across market-cap, sector, factor, and thematic categories.. Factor index funds tracking momentum, quality, and low-volatility strategies are seeing strong retail inflows as investors seek rule-based, low-cost alternatives to active funds.. Expense ratios on passive products have compressed to as low as 0.10–0.20% annually, compared to 1–1.5% for actively managed equity mutual funds..

What you should do: Check the underlying index of every passive fund in your portfolio — two index funds can track completely different indices and carry very different risk profiles.. Compare expense ratios across index funds in the same category on AMFI's website before starting a new SIP — even a 0.30% difference compounds significantly over 10 years.. Avoid stacking multiple thematic index funds (e.g., defence + manufacturing + PSU) without understanding overlap — they may concentrate your portfolio in the same stocks..

A Nifty 50 Equal Weight index fund gives all 50 stocks the same share — unlike standard Nifty 50 funds dominated by 5–6 large-caps. It is a genuinely different passive bet most SIP investors never consider.

For readers weighing their credit and loan options, our personal loan guide and CIBIL score resources put this update in context.