Index funds are best investment instrument and it provides returns align with market returns. Index funds are passively managed funds with low expense ratio. It simplifies the selection of funds to invest in large set of available funds in the market. Most of the time investors choose to invest only in Nifty 50, Nifty Next 50 funds. But there are others index funds are available in the market with flexibility and high returns. This post we are going to discuss other available index funds in the market, why we should invest in other index funds and the reason to invest in.
Is there other better option available to invest for high returns in the indices?
Does Nifty 50 and Nifty Next 50 investing beat the market, or any other broad market indices?
Let us explore different option available to invest in market Indices:
- Nifty 50 funds
- Nifty Next 50 funds
- SmallCap 250 funds
- Nifty200 Momentum 30 funds
- Nifty Midcap 150 Index funds
- Nifty 50 Value 20 funds
- Nifty 100 Index funds
- Nifty Low Vol 30 funds
- Alpha Low Vol 30 funds
- Midcap150 Quality 50 funds
- Nifty 200 Quality 30 Index funds
Recently the article published on mint shows that Midcap and SmallCap funds beats the Nifty50 return in long term. It helps for better diversification and high returns. The downside of SmallCap and midcap funds are that in negative returns, it goes more downward than Nifty 50 funds. But it long term it would beat the Nifty 50 index funds. So start investing 10% of your investment in midcap and SmallCap index funds for high returns in long term.
Smallcap and Midcap should be part of your portfolio for high returns
List of Small Cap and Mid cap index funds :
- Motilal Oswal Nifty SmallCap 250 Index Growth Direct Plan
- Aditya Birla Sun Life Nifty Midcap 150 Index Growth Direct Plan
- Axis Nifty 100 Index Growth Direct Plan
- Nippon India Nifty Midcap 150 Index Growth Direct Plan
- Axis Nifty SmallCap 50 Index Growth Direct Plan
There is another detailed data points from capitalmind of different indices returns. In that Momentum and Alpha funds provided 50% more return than Nifty 50 index funds. Momentum factor considers stocks that have outperformed recently and are likely to outperform in the near future. The alpha strategy considers stocks with high alpha, or excess returns over the benchmark. The first two charts showed the Nifty200 Momentum30 index as the best cumulative performer.
Nifty 200 Momentum 30 Index gives exposure to 30 high momentum stocks across large and mid-cap stocks within the Nifty 200 Index
The Nifty 200 Momentum 30 Index gives exposure to 30 high momentum stocks across large and mid-cap stocks within the Nifty 200 Index. Momentum is good in a way that it focuses on top 200 companies. The Nifty Alpha 50 Index is a much-diversified index having 50 stocks across the large-, mid- and small-cap space with highest alphas from the top 300 companies.
Start with Nifty 50, Nifty Next 50 and next invest in Momentum funds
“If somebody has a time horizon of ten-plus years and can tolerate some volatility, the momentum index can work pretty well,”
Before start investing in momentum funds, invest in Nifty 50 and Nifty Junior index. Because combination of a momentum and normal index work well for investors who are aggressive and looking for high returns. Alpha and momentum indices have outperformed other benchmark indices in various time frames. Alpha funds provides higher exposure to mid and small-cap space compared to momentum.
Combination of a momentum and normal index work well for investors who are aggressive and looking for high returns.
UTI Nifty200 Momentum 30 Index Growth Direct Plan
Nippon India Nifty 50 Value 20 Index Growth Direct Plan
Motilal Oswal Nifty 200 Momentum 30 Index Growth Direct Plan
ICICI Prudential Alpha Low Vol 30 ETF FoF Growth Direct Plan
SBI – ETF Quality(Nifty 200 Quality 30 Index)
Edelweiss Nifty 100 Quality 30 Index Growth Direct Plan
Kotak Nifty Alpha 50 ETF.
Best mutual funds to invest in 2022 , invest in mutual funds