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Business News/ Mutual Funds / News/  AUM of passive funds tracking Nifty indices hit new milestone of 5 lakh crore; key highlights here
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AUM of passive funds tracking Nifty indices hit new milestone of ₹5 lakh crore; key highlights here

The AUM of passive funds in India, including ETFs and index funds tracking Nifty indices, has surpassed ₹5tn ($67bn), according to the National Stock Exchange of India. These passive funds also started the year FY24 on a strong note with AUM increasing to ₹717,042 crore by May 2023 end.

Over the past five years, passive funds' AUM has grown at an annualised rate of 53%, with the number of passive funds available in India increasing from 90 to 349 in the same period. (Mint)Premium
Over the past five years, passive funds' AUM has grown at an annualised rate of 53%, with the number of passive funds available in India increasing from 90 to 349 in the same period. (Mint)

The National Stock Exchange of India (NSE) on Monday said that the asset under management (AUM) of passive funds like ETFs and index funds that track Nifty indices have touched a new milestone by crossing the 5 lakh crore mark. NSE Indices CEO Mukesh Agarwal believes that passive funds are well-suited for retail and institutional investors.

In the last 5 years, passive funds AUM has recorded an annualized growth rate of 53%. Passive funds AUM have skyrocketed from 80,755 crore as on March 31, 2018, to 674,783 crore as on March 31, 2023.

Also, in the past five years, the number of passive funds available in India has also grown from 90 as on March 31, 2018, to 349 as on March 31, 2023.

Mukesh Agarwal, CEO, of NSE Indices, said, "This is an important milestone and a matter of great pride for us. We would like to extend our heartfelt gratitude to all our stakeholders including the Ministry of Finance (GoI), Ministry of Labour & Employment (GoI), SEBI, EPFO, Asset Management Companies, Investors, Trading members, etc. for their unwavering trust and support."

Agarwal acknowledged that this accomplishment would not have been possible without the continued patronage and confidence shown by the valued clients.

Further, as per NSE's data, the fiscal FY23 was a landmark year for the Indian passive funds' industry as it registered record fund inflows of 1.55 lakh crore, and 121 new passive products were launched during the financial year.

Also, the AUM of the passive funds has kickstarted the financial year FY24 with a bang as it further increased to 717,042 crore as on May 31, 2023.

It needs to be noted that the Nifty indices linked passive funds account for about 72% of total Equity & Debt passive funds AUM and 75% of the total number of Equity & Debt passive funds in India.

Moving ahead, Agarwal said, "We will continue to work with various stakeholders to launch new and innovative indices to grow the passive funds market further."

He also added, "We strongly believe that passive funds are well suited for retail and institutional investors to invest in capital markets. We will continue with our efforts to promote passive funds."

As of May 31, 2023, there are 251 passive funds tracking 101 unique Nifty indices.

Moreover, large international fund managers also launch ETFs linked to Nifty indices which are listed in global markets. At present, there are 16 ETFs listed outside India with a combined AUM of $1.3 billion.

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Updated: 26 Jun 2023, 02:44 PM IST
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