Investing Basics Beginner

Index Fund

💡 In plain English: A fund that simply copies a market index like Nifty 50 — no fund manager picking stocks, ultra-low fees.

Definition

A type of mutual fund or ETF designed to replicate the performance of a specific market index by holding the same stocks in the same proportions.

📌 Real-World Example

A Nifty 50 Index Fund holds all 50 Nifty stocks in exact proportions. If Nifty returns 14% in a year, the fund returns ~13.9% (after minimal expense ratio of 0.1%).

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Related Terms

Diversification
Don't put all your eggs in one basket — spread investments across...
Expense Ratio
The annual fee a mutual fund charges to manage your money — lower...
ETF (Exchange-Traded Fund)
Like an index fund but traded on the stock exchange during market...
Mutual Fund
A pool of money from many investors managed by a professional fund...
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⚠️ Educational Content: All definitions and examples on this page are for educational and consultancy reference purposes only. They do not constitute financial, legal, or investment advice. Moneykar is not registered with SEBI, CBUAE, SCA, or any financial regulator. Consult a qualified professional before making financial decisions.

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