Discover the Best Index Funds in India for 2025 Offering High Returns and Low Costs
Index funds are becoming a go to investment option for those looking to grow their wealth steadily without the need to constantly monitor the market. These funds offer an easy and hassle free way to invest in mutual funds that simply track popular benchmark indices such as the Nifty 50 and the BSE Sensex. So if you are looking for a low cost, low risk approach to investing in mutual funds, index funds are worth considering
An index fund is a type of mutual fund or exchange traded fund that mirrors the performance of a specific market index such as Nifty 50 or Sensex. These funds are usually managed passively and have the intention to reflect the benchmark index performance rather than to outperform the same.
Moreover, these index funds also have lower fees and expense ratios as compared to actively managed mutual funds. Such index funds are designed to provide you with broad exposure that reduces the risk of focusing on just a few hand picked stocks.
An index fund is a type of mutual fund or exchange traded fund that mirrors the performance of a specific market index such as Nifty 50 or Sensex. These funds are usually managed passively and have the intention to reflect the benchmark index performance rather than to outperform the same.
Moreover, these index funds also have lower fees and expense ratios as compared to actively managed mutual funds. Such index funds are designed to provide you with broad exposure that reduces the risk of focusing on just a few hand picked stocks.
Here are a few of the top performing index funds in India this year:
This index fund focuses primarily on the stocks of mid cap companies by tracking the Nifty Midcap 150 Index. This is ideal for you if you are looking to invest in mid sized companies with a comparatively high growth potential. It has a current net asset value of Rs. 40.51 alongside an impressive return of 31.53% per annum since its inception. Moreover, its total fund size stands at Rs. 1,866 crores that is only a sign of its popularity among investors.
The Bandhan Nifty 50 Index Fund is a great option for investors looking for a balanced exposure to large cap company stocks. This fund tracks the Nifty 50 benchmark index and has provided a steady yet growing return percentage of around 14.41% per annum since its launch. Moreover, it has a NAV of Rs. 56.98 as of September 2025, with an ultra low expense ratio of 0.1% and a total fund size of Rs. 1,527 crores.
The UTI Nifty 50 Index Fund is another top contender for large cap investments. It has a NAV of Rs. 179.16 as of September 2025 and ensures a steady return of 14.28% per annum since its inception. With a competitive expense ratio of 0.18% and no exit load, this index fund is a flexible option for investors of all kinds. The fund boasts an AUM of Rs. 19,848 crores, one of the largest in its category.
The ICICI Prudential Nifty 50 Index Fund is well suited for investors who are looking for consistent returns from large cap stocks. It has a current NAV is Rs. 269.53 with a long term return rate of 14.35% per annum. The fund is known for its cost efficiency, with an expense ratio of just 0.17%. Like other top funds, it has no exit load, offering flexibility in case you need to exit early. Moreover, it currently has an AUM of Rs. 11,525 crores.
The below table compares the key features of a few of the best performing index funds in India:
Fund Name | Expense Ratio | AUM (Rs. Crores) | Returns since inception (per annum) | Exit Load |
Motilal Oswal Nifty Midcap 150 Index Fund | 0.3% | 1,866 | 31.53% | 1% |
Bandhan Nifty 50 Index Fund | 0.1% | 1,527 | 14.41% | 0.1% |
UTI Nifty 50 Index Fund | 0.18% | 19,848 | 14.28% | 0.18% |
ICICI Prudential Nifty 50 Index Fund | 0.17% | 11,525 | 14.35% | 0.17% |
Index funds are a simple yet effective way to invest in the stock market with minimal fees. Be it a newcomer or a seasoned investor, these funds provide a stable foundation for long term growth. These funds are designed to save you time and money while providing exposure to the entire market or specific segments. When selecting an index fund to invest in, it is key for you to consider factors such as its expense ratios, historical returns, and your investment horizon. In the end, the best index fund for you will depend on your financial goals and risk tolerance.
So if you are planning on investing in mutual funds, visit the easy to use Bajaj Finance mutual fund platform and explore over 1,000 mutual fund schemes. Use the one of a kind Mutual Fund Calculator and remember to compare mutual funds before investing.
An index fund is a kind of mutual fund that aims to mirror the performance of a specific market index by investing in the same stocks in proportion to the index.
Yes, index funds are ideal for beginners due to their simplicity, lower costs, and reduced risk through diversification.
Index funds passively track an index, leading to lower fees, whereas actively managed funds involve fund managers selecting stocks, which often results in higher fees.
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