It’s only in the past five years that asset management companies (AMCs) have started focusing on passive funds. Motilal Oswal AMC, which started selling passive funds two years ago, has 14 index funds, including four ETFs, now. Moreover, the performance of passive funds is becoming at par with active funds now," said Pratik Oswal, head of passive funds at Motilal Oswal AMC. According to experts, both index funds and ETFs are good for those looking to hold their investments for the long term. One of the key reasons behind tracking error creeping into index funds is the delay in holding adjustments bet-ween the tracking index and the fund.

Source: Mint May 06, 2021 18:45 UTC