Passive investing is eating up the developed markets. Moody’s predicts that by 2021 passive investing will overtake active investing.
In India, although we crossed 1 lakh in passive assets, the flows have been largely driven by Employees’ Provident Fund Organisation (EPFO) flows. EPF can now invest up to 15% of its incremental flows in equities and they don’t invest active funds but rather passive ETFs.
The ETF aum is largely due to the EPFO flows. However, if you see the graph below, you will notice that index fund, where a vast majority of the retails investors has grown decently. So yeah, fair to conclude that there is a fair bit of investor interest in index funds.
Google Trends data can also be a proxy for this. Here are the search trends for the terms “Index funds” and “passive investing”. The search volume has clearly gone up in the past 5 years.
Given the interest around passive investing, we decided to do a webinar with Gauri Sekari and Anil Ghelani of DSP Mutual Fund. Gauri is the fund manager of DSP Equal NIFTY 50 Fund, DSP Liquid ETF, DSP Nifty 50 Index Fund, and DSP Nifty Next 50 Index Fund. Anil Head of Passive Investments & Products.
If you are at all interested in knowing what is passive investing and how index fund work, then this webinar is for you: