For decades, Indian investors have debated whether actively managed funds or passive funds generate better long-term wealth. In recent years, index Investing has gained momentum in India, especially with the growing popularity of Nifty Index Funds.

These funds track the performance of the Nifty 50 index, which represents 50 of the largest and most liquid companies listed on the National Stock Exchange (NSE). For investors seeking diversification, low costs, and market-level returns, Nifty Index Funds have become a cornerstone of modern portfolios. But before you start investing, it’s important to understand how these funds work, their benefits, limitations, and how to select the right one.
A Nifty Index Fund is a type of mutual fund that passively tracks the Nifty 50 index. Instead of trying to outperform the market, it simply mirrors the index by holding the same stocks in the same proportion.
For example:
If Reliance Industries has a 10% weight in the Nifty 50, the fund will allocate about 10% of its assets to Reliance.
Similarly, HDFC Bank, Infosys, TCS, and other top companies get included in the same weightage.
This ensures that when the Nifty rises or falls, your fund’s performance closely reflects the same movement.
The Nifty 50 represents companies across 13+ sectors, including banking, IT, energy, FMCG, and pharma. By investing in one index fund, you automatically diversify across the backbone of India’s economy.
Unlike actively managed Mutual Funds, index funds don’t require expensive research teams. This translates into lower expense ratios, often in the range of 0.1% to 0.3% — saving investors significant costs over the long term.
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Over long periods, most active funds struggle to consistently beat the index. With an index fund, you are guaranteed market-matching returns (minus small costs).
For new investors, Nifty Index Funds are a simple starting point. Instead of selecting among hundreds of mutual funds, one index fund offers a ready-made, balanced Portfolio.
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Fund Selection Methodology used to find 10 funds
All the funds mentioned above are ideal, we are giving you detailed analysis of 5 funds.
(Erstwhile ICICI Prudential Nifty Index Fund) An open-ended index linked growth scheme seeking to track the returns of the S&P CNX Nifty index through investment in a basket of stocks drawn from the constituents of the Nifty. Below is the key information for ICICI Prudential Nifty Index Fund Returns up to 1 year are on The principal investment objective of the scheme is to invest in stocks of companies comprising Nifty 50 Index and endeavour to achieve return equivalent to Nifty 50 by “passive” investment. The scheme will be managed
by replicating the index in the same weightage as in the Nifty 50 Index with the intention of minimising the performance differences between the scheme and the Nifty 50 Index in capital terms, subject to market liquidity, costs of trading, management expenses and other factors which may cause tracking error. The
scheme would alter the scrips/weights as and when the same are altered in the Nifty 50 Index. Research Highlights for UTI Nifty Index Fund Below is the key information for UTI Nifty Index Fund Returns up to 1 year are on The Investment Objective of the Scheme is to invest in companies whose securities are included in the Nifty and subject to tracking errors, endeavouring to attain results commensurate with the Nifty 50 under NSENifty Plan Research Highlights for Franklin India Index Fund Nifty Plan Below is the key information for Franklin India Index Fund Nifty Plan Returns up to 1 year are on The scheme will adopt a passive investment strategy. The scheme will
invest in stocks comprising the Nifty 50 Index in the same proportion as in the
index with the objective of achieving returns equivalent to the Total Returns
Index of Nifty 50 Index by minimizing the performance difference between the
benchmark index and the scheme. The Total Returns Index is an index that
reflects the returns on the index from index gain/loss plus dividend payments
by the constituent stocks. Research Highlights for SBI Nifty Index Fund Below is the key information for SBI Nifty Index Fund Returns up to 1 year are on The investment objective of the scheme is to replicate the Nifty 50 by investing in securities of the Nifty 50 in the same proportion / weightage. However, there is no assurance or guarantee that the objectives of the scheme will be realized
and the scheme does not assure or guarantee any returns . Research Highlights for Bandhan Nifty Fund Below is the key information for Bandhan Nifty Fund Returns up to 1 year are on 1. ICICI Prudential Nifty Index Fund
ICICI Prudential Nifty Index Fund
Growth Launch Date 26 Feb 02 NAV (16 Oct 26) ₹234.616 ↑ 1.53 (0.66 %) Net Assets (Cr) ₹17,254 on 31 Aug 26 Category Others - Index Fund AMC ICICI Prudential Asset Management Company Limited Rating ☆☆ Risk Moderately High Expense Ratio 0.36 Sharpe Ratio -0.32 Information Ratio -9.28 Alpha Ratio -0.42 Min Investment 5,000 Min SIP Investment 100 Exit Load NIL Growth of 10,000 investment over the years.
Date Value 30 Sep 21 ₹10,000 30 Sep 22 ₹9,790 30 Sep 23 ₹11,312 30 Sep 24 ₹14,976 30 Sep 25 ₹14,399 30 Sep 26 ₹13,323 Returns for ICICI Prudential Nifty Index Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 16 Oct 26 Duration Returns 1 Month -0.3% 3 Month -3.7% 6 Month -3.7% 1 Year -8.9% 3 Year 6.3% 5 Year 5.5% 10 Year 15 Year Since launch 13.7% Historical performance (Yearly) on absolute basis
Year Returns 2025 11.4% 2024 9.6% 2023 20.7% 2022 5.2% 2021 24.9% 2020 15.2% 2019 12.8% 2018 3.4% 2017 28.7% 2016 3.6% Fund Manager information for ICICI Prudential Nifty Index Fund
Name Since Tenure Nishit Patel 18 Jan 21 5.62 Yr. Ajaykumar Solanki 1 Feb 24 2.58 Yr. Ashwini Bharucha 18 Dec 24 1.7 Yr. Venus Ahuja 1 Nov 25 0.83 Yr. Data below for ICICI Prudential Nifty Index Fund as on 31 Aug 26
Asset Allocation
Asset Class Value Cash 0.04% Equity 99.96% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Mar 05 | HDFCBANK10% ₹1,699 Cr 23,965,268
↑ 230,065 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Mar 05 | ICICIBANK9% ₹1,630 Cr 11,211,199
↑ 107,629 Reliance Industries Ltd (Energy)
Equity, Since 31 Mar 05 | RELIANCE8% ₹1,350 Cr 10,572,602
↑ 101,499 Bharti Airtel Ltd (Communication Services)
Equity, Since 31 Aug 09 | BHARTIARTL5% ₹862 Cr 4,758,963
↑ 45,693 Larsen & Toubro Ltd (Industrials)
Equity, Since 29 Feb 12 | LT4% ₹741 Cr 1,831,740
↑ 17,593 State Bank of India (Financial Services)
Equity, Since 31 Mar 05 | SBIN4% ₹686 Cr 6,468,862
↑ 62,103 Infosys Ltd (Technology)
Equity, Since 31 Mar 05 | INFY4% ₹622 Cr 5,489,256
↑ 52,703 Axis Bank Ltd (Financial Services)
Equity, Since 31 Mar 09 | 5322153% ₹584 Cr 4,494,554
↑ 43,154 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 29 Feb 12 | KOTAKBANK3% ₹483 Cr 11,522,374
↑ 110,616 Mahindra & Mahindra Ltd (Consumer Cyclical)
Equity, Since 31 Mar 05 | M&M3% ₹459 Cr 1,397,202
↑ 13,420 2. UTI Nifty Index Fund
UTI Nifty Index Fund
Growth Launch Date 6 Mar 00 NAV (16 Oct 26) ₹160.516 ↑ 1.05 (0.66 %) Net Assets (Cr) ₹29,485 on 31 Aug 26 Category Others - Index Fund AMC UTI Asset Management Company Ltd Rating ☆☆ Risk Moderately High Expense Ratio 0.29 Sharpe Ratio -0.31 Information Ratio -10.59 Alpha Ratio -0.3 Min Investment 5,000 Min SIP Investment 500 Exit Load NIL Growth of 10,000 investment over the years.
Date Value 30 Sep 21 ₹10,000 30 Sep 22 ₹9,803 30 Sep 23 ₹11,342 30 Sep 24 ₹15,017 30 Sep 25 ₹14,457 30 Sep 26 ₹13,393 Returns for UTI Nifty Index Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 16 Oct 26 Duration Returns 1 Month -0.3% 3 Month -3.7% 6 Month -3.7% 1 Year -8.8% 3 Year 6.4% 5 Year 5.7% 10 Year 15 Year Since launch 11% Historical performance (Yearly) on absolute basis
Year Returns 2025 11.6% 2024 9.6% 2023 20.9% 2022 5.3% 2021 25.2% 2020 15.5% 2019 13.2% 2018 4.3% 2017 29.7% 2016 4% Fund Manager information for UTI Nifty Index Fund
Name Since Tenure Sharwan Goyal 31 Jul 18 8.09 Yr. Ayush Jain 2 May 22 4.34 Yr. Lokesh Kulthia 19 Jun 26 0.2 Yr. Data below for UTI Nifty Index Fund as on 31 Aug 26
Asset Allocation
Asset Class Value Equity 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Jan 10 | HDFCBANK10% ₹2,905 Cr 40,975,419
↑ 466,798 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Jan 03 | ICICIBANK9% ₹2,787 Cr 19,168,725
↑ 218,374 Reliance Industries Ltd (Energy)
Equity, Since 31 Jan 03 | RELIANCE8% ₹2,308 Cr 18,076,860
↑ 205,934 Bharti Airtel Ltd (Communication Services)
Equity, Since 29 Feb 04 | BHARTIARTL5% ₹1,474 Cr 8,136,797
↑ 92,696 Larsen & Toubro Ltd (Industrials)
Equity, Since 31 Dec 04 | LT4% ₹1,267 Cr 3,131,881
↑ 35,679 State Bank of India (Financial Services)
Equity, Since 31 Jan 03 | SBIN4% ₹1,172 Cr 11,060,356
↑ 126,001 Infosys Ltd (Technology)
Equity, Since 31 Jan 03 | INFY4% ₹1,064 Cr 9,385,439
↑ 106,920 Axis Bank Ltd (Financial Services)
Equity, Since 31 Mar 09 | 5322153% ₹999 Cr 7,684,715
↑ 87,546 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Dec 10 | KOTAKBANK3% ₹826 Cr 19,700,767
↑ 224,434 Mahindra & Mahindra Ltd (Consumer Cyclical)
Equity, Since 31 Jan 03 | M&M3% ₹784 Cr 2,388,915
↑ 27,215 3. Franklin India Index Fund Nifty Plan
Franklin India Index Fund Nifty Plan
Growth Launch Date 4 Aug 00 NAV (16 Oct 26) ₹187.798 ↑ 1.22 (0.65 %) Net Assets (Cr) ₹715 on 31 Aug 26 Category Others - Index Fund AMC Franklin Templeton Asst Mgmt(IND)Pvt Ltd Rating ☆ Risk Moderately High Expense Ratio 0.63 Sharpe Ratio -0.33 Information Ratio -5.23 Alpha Ratio -0.6 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-30 Days (1%),30 Days and above(NIL) Growth of 10,000 investment over the years.
Date Value 30 Sep 21 ₹10,000 30 Sep 22 ₹9,772 30 Sep 23 ₹11,253 30 Sep 24 ₹14,859 30 Sep 25 ₹14,265 30 Sep 26 ₹13,186 Returns for Franklin India Index Fund Nifty Plan
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 16 Oct 26 Duration Returns 1 Month -0.3% 3 Month -3.7% 6 Month -3.8% 1 Year -9% 3 Year 6.1% 5 Year 5.3% 10 Year 15 Year Since launch 11.8% Historical performance (Yearly) on absolute basis
Year Returns 2025 11.3% 2024 9.5% 2023 20.2% 2022 4.9% 2021 24.3% 2020 14.7% 2019 12% 2018 3.2% 2017 28.3% 2016 3.3% Fund Manager information for Franklin India Index Fund Nifty Plan
Name Since Tenure Sandeep Manam 18 Oct 21 4.87 Yr. Shyam Sriram 26 Sep 24 1.93 Yr. Data below for Franklin India Index Fund Nifty Plan as on 31 Aug 26
Asset Allocation
Asset Class Value Cash 0.31% Equity 99.69% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Jan 03 | HDFCBANK10% ₹70 Cr 990,850
↓ -8,577 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Jan 10 | ICICIBANK9% ₹67 Cr 463,530
↓ -4,012 Reliance Industries Ltd (Energy)
Equity, Since 31 Jan 03 | RELIANCE8% ₹56 Cr 437,127
↓ -3,784 Bharti Airtel Ltd (Communication Services)
Equity, Since 31 Mar 04 | BHARTIARTL5% ₹36 Cr 196,760
↓ -1,704 Larsen & Toubro Ltd (Industrials)
Equity, Since 30 Jun 12 | LT4% ₹31 Cr 75,734
↓ -655 State Bank of India (Financial Services)
Equity, Since 31 Jan 03 | SBIN4% ₹28 Cr 267,457
↓ -2,315 Infosys Ltd (Technology)
Equity, Since 29 Feb 12 | INFY4% ₹26 Cr 226,955
↓ -1,964 Axis Bank Ltd (Financial Services)
Equity, Since 30 Jun 09 | 5322153% ₹24 Cr 185,828
↓ -1,609 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Mar 12 | KOTAKBANK3% ₹20 Cr 476,395
↓ -4,124 Mahindra & Mahindra Ltd (Consumer Cyclical)
Equity, Since 28 Feb 07 | M&M3% ₹19 Cr 57,768
↓ -500 4. SBI Nifty Index Fund
SBI Nifty Index Fund
Growth Launch Date 17 Jan 02 NAV (16 Oct 26) ₹205.964 ↑ 1.35 (0.66 %) Net Assets (Cr) ₹13,928 on 31 Aug 26 Category Others - Index Fund AMC SBI Funds Management Private Limited Rating ☆ Risk Moderately High Expense Ratio 0.47 Sharpe Ratio -0.32 Information Ratio -26.98 Alpha Ratio -0.48 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-15 Days (0.2%),15 Days and above(NIL) Growth of 10,000 investment over the years.
Date Value 30 Sep 21 ₹10,000 30 Sep 22 ₹9,779 30 Sep 23 ₹11,291 30 Sep 24 ₹14,931 30 Sep 25 ₹14,344 30 Sep 26 ₹13,266 Returns for SBI Nifty Index Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 16 Oct 26 Duration Returns 1 Month -0.3% 3 Month -3.7% 6 Month -3.7% 1 Year -9% 3 Year 6.2% 5 Year 5.5% 10 Year 15 Year Since launch 13.2% Historical performance (Yearly) on absolute basis
Year Returns 2025 11.3% 2024 9.5% 2023 20.7% 2022 5.1% 2021 24.7% 2020 14.6% 2019 12.5% 2018 3.8% 2017 29.1% 2016 3.4% Fund Manager information for SBI Nifty Index Fund
Name Since Tenure Viral Chhadva 1 Mar 26 0.5 Yr. Data below for SBI Nifty Index Fund as on 31 Aug 26
Asset Allocation
Asset Class Value Equity 100.04% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Mar 03 | HDFCBANK10% ₹1,372 Cr 19,357,662
↑ 66,631 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Jan 03 | ICICIBANK9% ₹1,317 Cr 9,055,715
↑ 31,171 Reliance Industries Ltd (Energy)
Equity, Since 31 Jan 03 | RELIANCE8% ₹1,091 Cr 8,539,895
↑ 29,397 Bharti Airtel Ltd (Communication Services)
Equity, Since 29 Feb 04 | BHARTIARTL5% ₹696 Cr 3,843,997
↑ 13,232 Larsen & Toubro Ltd (Industrials)
Equity, Since 31 Dec 04 | LT4% ₹598 Cr 1,479,567
↑ 5,093 State Bank of India (Financial Services)
Equity, Since 31 Jan 03 | SBIN4% ₹554 Cr 5,225,148
↑ 17,985 Infosys Ltd (Technology)
Equity, Since 31 Jan 03 | INFY4% ₹503 Cr 4,433,881
↑ 15,261 Axis Bank Ltd (Financial Services)
Equity, Since 28 Feb 10 | 5322153% ₹472 Cr 3,630,420
↑ 12,495 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Mar 12 | KOTAKBANK3% ₹390 Cr 9,307,060
↑ 32,035 Mahindra & Mahindra Ltd (Consumer Cyclical)
Equity, Since 30 Jun 10 | M&M3% ₹370 Cr 1,128,575
↑ 3,885 5. Bandhan Nifty Fund
Bandhan Nifty Fund
Growth Launch Date 30 Apr 10 NAV (16 Oct 26) ₹50.0684 ↑ 0.33 (0.66 %) Net Assets (Cr) ₹2,797 on 31 Jul 26 Category Others - Index Fund AMC IDFC Asset Management Company Limited Rating ☆☆ Risk Moderately High Expense Ratio 0.6 Sharpe Ratio -0.33 Information Ratio -13.02 Alpha Ratio -0.67 Min Investment 100 Min SIP Investment 1,000 Exit Load 0-7 Days (1%),7 Days and above(NIL) Growth of 10,000 investment over the years.
Date Value 30 Sep 21 ₹10,000 30 Sep 22 ₹9,804 30 Sep 23 ₹11,303 30 Sep 24 ₹14,921 30 Sep 25 ₹14,309 30 Sep 26 ₹13,208 Returns for Bandhan Nifty Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 16 Oct 26 Duration Returns 1 Month -0.3% 3 Month -3.7% 6 Month -3.8% 1 Year -9.1% 3 Year 6% 5 Year 5.4% 10 Year 15 Year Since launch 10.3% Historical performance (Yearly) on absolute basis
Year Returns 2025 11.2% 2024 9.2% 2023 20.5% 2022 5.4% 2021 24.4% 2020 16.2% 2019 12.9% 2018 4.4% 2017 29.5% 2016 3.9% Fund Manager information for Bandhan Nifty Fund
Name Since Tenure Abhishek Jain 8 Mar 25 1.48 Yr. Mayuresh Nagvekar 17 Feb 26 0.54 Yr. Data below for Bandhan Nifty Fund as on 31 Jul 26
Asset Allocation
Asset Class Value Cash 0.13% Equity 99.87% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 30 Apr 10 | HDFCBANK10% ₹277 Cr 3,904,246
↑ 78,212 ICICI Bank Ltd (Financial Services)
Equity, Since 30 Apr 10 | ICICIBANK9% ₹266 Cr 1,826,447
↑ 36,589 Reliance Industries Ltd (Energy)
Equity, Since 30 Apr 10 | RELIANCE8% ₹220 Cr 1,722,411
↑ 34,504 Bharti Airtel Ltd (Communication Services)
Equity, Since 30 Apr 10 | BHARTIARTL5% ₹140 Cr 775,295
↑ 15,531 Larsen & Toubro Ltd (Industrials)
Equity, Since 29 Feb 12 | LT4% ₹121 Cr 298,414
↑ 5,978 State Bank of India (Financial Services)
Equity, Since 31 Aug 11 | SBIN4% ₹112 Cr 1,053,860
↑ 21,111 Infosys Ltd (Technology)
Equity, Since 30 Apr 10 | INFY4% ₹101 Cr 894,269
↑ 17,914 Axis Bank Ltd (Financial Services)
Equity, Since 30 Apr 10 | 5322153% ₹95 Cr 732,220
↑ 14,668 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Mar 12 | KOTAKBANK3% ₹79 Cr 1,877,141
↑ 37,604 Mahindra & Mahindra Ltd (Consumer Cyclical)
Equity, Since 31 Jan 11 | M&M3% ₹75 Cr 227,622
↑ 4,560
To understand why these funds are attractive, let’s look at the Nifty’s performance:
This shows that over long horizons, Nifty Index Funds have generated steady wealth, beating inflation and offering compounding growth.
(Note: Returns vary depending on market cycles, but long-term investors benefit from India’s economic growth story.)
While index funds are considered safe, they are not risk-free:
Market Risk – If the Nifty falls due to global or domestic factors, your fund will also fall.
Tracking Error – Slight mismatches between the index and fund returns can occur due to costs or timing.
No Outperformance – Unlike active funds, index funds will never beat the market — they only replicate it.
Many investors confuse index funds with ETFs. Here’s the difference:
| Feature | Nifty Index Fund | Nifty ETF |
|---|---|---|
| Trading | Bought/sold like mutual funds (NAV-based) | Traded on stock exchanges like shares |
| Convenience | SIP option available | Requires Demat account |
| Liquidity | Daily NAV-based | Intraday trading possible |
| Costs | Slightly higher than ETFs | Slightly lower expense ratio |
For most retail investors, index funds via SIPs are more convenient than ETFs.
Open Free Investment Account for Lifetime at Fincash.com.
Complete your Registration and KYC Process
Upload Documents (PAN, Aadhaar, etc.). And, You are Ready to Invest!
When selecting an index fund, look beyond just returns. Key factors include:
Some of the well-known Nifty Index Funds in India include:
However, if you seek Alpha (market-beating returns), active funds or thematic strategies may be better.
Nifty Index Funds represent the power of passive investing in India. By offering low costs, diversification, and steady returns, they provide a reliable wealth-building tool for retail investors.
As India’s economy continues to expand, the Nifty 50 will remain a reflection of the country’s growth. For investors who want simplicity, transparency, and long-term compounding, Nifty Index Funds deserve a place in their portfolio.
👉 The real question is not whether you should invest, but how soon you start.
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Research Highlights for ICICI Prudential Nifty Index Fund