How Did India's ETF AUM Surge Over 5 Times in 5 Years While Retail Investor Folios Skyrocketed 11-Fold?
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Synopsis
Discover how India's ETF market has transformed, with a fivefold increase in AUM and an elevenfold rise in retail investor folios. This remarkable growth highlights a shift in investment trends and the increasing confidence of retail investors in ETFs.
Key Takeaways
- India's ETF AUM grew more than fivefold from 2020 to 2025.
- Retail investor folios increased elevenfold during the same period.
- Retail investors now represent over 97% of all ETF folios.
- The retail AUM has tripled, indicating growing confidence.
- Equity ETFs continue to dominate the market.
Mumbai, July 2 (NationPress) India's Exchange-Traded Funds (ETFs) have experienced remarkable escalation in the past five years, with total Assets Under Management (AUM) soaring to more than five times and retail investor folios witnessing an eleven-fold increase, according to a recent report released on Wednesday.
Between March 2020 and March 2025, the total AUM of ETFs in India expanded nearly 5.5 times, as highlighted in a report by Zerodha Fund House.
By the end of this timeframe, ETFs represented Rs 8.38 lakh crore, constituting approximately 13 percent of the overall Rs 65.74 lakh crore mutual fund sector.
In contrast, ETFs held merely a 7 percent share in 2020, indicating the rising preference for ETFs as a viable investment choice in the nation.
The number of retail folios in ETF schemes also experienced substantial growth — from slightly over 23 lakh in March 2020 to around 2.63 crore by March 2025.
Today, retail investors account for more than 97 percent of all ETF folios, showcasing a significant increase in awareness and confidence in ETFs among the general public.
“This study illustrates a new chapter for Indian ETFs, characterized by increasing retail participation and a broader range of products, as evidenced by higher resultant volumes,” stated Vishal Jain, CEO of Zerodha Fund House.
Over this five-year span, retail AUM has more than tripled, climbing from Rs 5,335 crore to over Rs 17,800 crore.
The total number of ETF offerings has also nearly tripled during this period.
Innovative products, such as commodity ETFs like silver-backed funds launched in 2022, have broadened the investment options available.
Equity ETFs continue to lead the pack, with nearly 80 percent of the total ETF AUM consistently sourced from equity-linked instruments since 2020.
Trading activity in ETFs has surged as well. The trading volume escalated from Rs 51,101 crore in FY 2019-20 to Rs 3.83 lakh crore in FY 2024-25 — representing a more than sevenfold increase.
Remarkably, the volume has more than doubled in just the past year, reflecting heightened liquidity and investor interest, according to the report.
Point of View
I believe that the meteoric rise of ETFs in India signals a positive shift in investment patterns among retail investors. This trend not only reflects growing financial literacy but also underscores the importance of trust in financial products. The data shows that the Indian market is evolving, and investors are becoming more engaged in their financial futures.
NationPress
11/07/2025
Frequently Asked Questions
What is the current AUM of ETFs in India?
As of March 2025, the AUM of ETFs in India reached Rs 8.38 lakh crore, which is a significant increase from previous years.
How many retail investor folios are there in ETFs?
The number of retail investor folios in ETFs surged from over 23 lakh in March 2020 to approximately 2.63 crore by March 2025.
What percentage of ETF folios are held by retail investors?
Retail investors now account for more than 97 percent of all ETF folios, indicating heightened awareness and confidence in ETFs.
How has trading volume in ETFs changed?
The trading volume in ETFs increased from Rs 51,101 crore in FY 2019-20 to Rs 3.83 lakh crore in FY 2024-25, showcasing rapid growth in trading activity.
What types of ETFs are gaining popularity?
Equity ETFs dominate the market, making up nearly 80 percent of the total ETF AUM, while new products like commodity ETFs have also been introduced.
