Should I pick active large-cap funds or stick to Nifty 50 index funds for a 40yr horizon?
Published 3 October 2026
My bank RM is pushing an active large-cap fund saying the fund manager will beat the market. But the expense ratio is over 1%.
Should I just stick to a low-cost passive index fund like the Nifty 50?
The problem is that most active large-cap managers fail to consistently beat the market over long periods. You end up paying high expense ratios for active management that underperforms. Because passive funds simply mirror an index, the fund manager's workload is lower and so are the fees.
If you are investing in India for the long haul, avoid paying these high expense ratios. Stick to low-cost passive funds to minimize commissions and keep more of your compounding wealth.
Disclaimer: All information shared above are strictly for educational and informational purposes only. It should not be construed as financial or investment advice.
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