Shift Toward Passive Investing Accelerates as Index ETFs Draw ₹4,950 Crore

October mutual fund flow data showed a pronounced move toward passive index strategies. Investors pulled approximately ₹4,950 crore from active equity schemes, reallocating into exchange-traded and index funds tracking major benchmarks. The migration follows sustained alpha underperformance in discretionary portfolios and growing transparency in passive instruments. Institutional inflows dominated volumes, while retail SIP participation broadened. Fund managers indicated that cost efficiency, ease of access, and predictable returns remain decisive factors. Analysts expect passive market share to climb toward 25% by FY27 if trends persist.