A mutual fund or ETF that replicates a market index (like Nifty 50 or Sensex) by holding the same stocks in the same proportions. Known for low expense ratios and passive management.
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Index Fund
Mutual Funds
Related terms
AMC
Asset Management Company. A firm that invests pooled funds from investors into securities such as stocks and bonds. Examples in India include SBI MF, HDFC AMC, and ICICI Prudential AMC.
AUM
Assets Under Management. The total market value of investments managed by a mutual fund or portfolio manager. Larger AUM generally indicates investor confidence.
ETF
Exchange-Traded Fund. A fund that tracks an index, commodity, or basket of assets and is traded on stock exchanges like regular shares. Nifty BeES and Gold BeES are popular Indian ETFs.
Expense Ratio
The annual fee charged by a mutual fund or ETF as a percentage of assets under management. Lower expense ratios mean more of your returns stay with you.
Lump Sum
Investing a large amount of money at one time, as opposed to spreading it over regular intervals (SIP). Timing matters more with lump sum investing.
Mutual Fund
A professionally managed investment fund that pools money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities.