Top Rated Index Mutual Funds in 2026 - Best Index Funds

Best Index Funds to Invest in 2026

Note: 3Y & 5Y returns are annualised. Rest everything is absolute.

Scheme	AUM (in Cr.)	Fund Age	1W	1M	3M	6M	1Y	3Y	5Y
ICICI Prudential NASDAQ 100 Index Fund Direct Growth Compare	₹ 3,414	4 Yrs	-1.34%	2.28%	-4.79%	21.40%	33.95%	29.16%	0.00%
Motilal Oswal S&P 500 Index Fund Direct Growth Compare	₹ 4,500	6 Yrs	-0.58%	1.94%	0.53%	15.78%	29.03%	25.20%	17.56%
UTI Nifty 500 Value 50 Index Fund Direct Growth Compare	₹ 825	3 Yrs	-1.20%	-1.08%	-3.09%	-3.66%	15.83%	24.07%	0.00%
Motilal Oswal BSE Enhanced Value Index Fund Direct Growth Compare	₹ 2,219	4 Yrs	-1.25%	-1.48%	-3.14%	-9.72%	11.71%	22.84%	0.00%
ICICI Prudential Nifty Pharma Index Fund Direct Growth Compare	₹ 148	3 Yrs	0.59%	0.94%	11.79%	16.75%	23.44%	21.32%	0.00%
ICICI Prudential Nifty Auto Index Fund Direct Growth Compare	₹ 242	3 Yrs	-3.51%	-2.53%	7.95%	2.39%	10.10%	21.21%	0.00%
Edelweiss MSCI India Domestic & World Healthcare 45 Index Fund Direct Growth Compare	₹ 195	5 Yrs	-0.88%	1.44%	12.64%	12.92%	23.89%	20.35%	13.76%
Kotak Nifty Smallcap 50 Index Fund Direct Growth Compare	₹ 229	3 Yrs	-1.46%	2.34%	11.27%	20.75%	16.57%	19.90%	0.00%
Axis Nifty Smallcap 50 Index Fund Direct Growth Compare	₹ 730	4 Yrs	-1.46%	2.34%	11.24%	21.00%	16.85%	19.83%	0.00%
Aditya Birla Sun Life Nifty Smallcap 50 Index Fund Direct Growth Compare	₹ 348	5 Yrs	-1.46%	2.33%	11.19%	20.97%	16.73%	19.78%	13.77%
Navi Nifty India Manufacturing Index Fund Direct Growth Compare	₹ 83	4 Yrs	-1.81%	-0.31%	3.67%	4.81%	12.57%	18.68%	0.00%
Kotak Nifty Next 50 Index Fund Direct Growth Compare	₹ 1,222	5 Yrs	-2.05%	-0.84%	4.37%	6.86%	9.58%	18.27%	12.27%
LIC MF Nifty Next 50 Index Fund Direct Growth Compare	₹ 111	13 Yrs	-2.04%	-0.84%	4.72%	7.17%	9.79%	18.25%	12.17%
UTI Nifty Next 50 Index Fund Direct Growth Compare	₹ 7,360	8 Yrs	-2.06%	-0.84%	4.38%	6.83%	9.52%	18.25%	12.09%
Edelweiss Nifty Next 50 Index Fund Direct Growth Compare	₹ 295	3 Yrs	-2.05%	-0.83%	4.43%	6.83%	9.54%	18.22%	0.00%
Motilal Oswal Nifty Next 50 Index Fund Direct Growth Compare	₹ 510	6 Yrs	-2.06%	-0.85%	4.33%	6.75%	9.42%	18.22%	12.11%
Axis Nifty Next 50 Index Fund Direct Growth Compare	₹ 535	4 Yrs	-2.06%	-0.86%	4.36%	6.85%	9.62%	18.22%	0.00%
SBI Nifty Next 50 Index Fund Direct Growth Compare	₹ 2,273	5 Yrs	-2.06%	-0.86%	4.38%	6.80%	9.47%	18.21%	12.09%
DSP Nifty Next 50 Index Fund Direct Growth Compare	₹ 1,352	7 Yrs	-2.06%	-0.84%	4.36%	6.74%	9.47%	18.17%	12.12%
Navi Nifty Next 50 Index Fund Direct Growth Compare	₹ 1,314	4 Yrs	-2.06%	-0.85%	4.37%	6.72%	9.41%	18.13%	0.00%
Aditya Birla Sun Life Nifty Next 50 Index Fund Direct Growth Compare	₹ 286	4 Yrs	-2.06%	-0.87%	4.33%	6.86%	9.46%	18.03%	0.00%
ICICI Prudential Nifty Next 50 Index Fund Direct Growth Compare	₹ 9,935	13 Yrs	-2.06%	-0.86%	4.25%	6.66%	9.27%	18.01%	11.96%
HDFC NIFTY Next 50 Index Fund Direct Growth Compare	₹ 2,659	4 Yrs	-2.06%	-0.87%	4.34%	6.73%	9.38%	17.97%	0.00%
HSBC Nifty Next 50 Index Fund Direct Growth Compare	₹ 176	6 Yrs	-2.06%	-0.87%	4.49%	6.49%	9.11%	17.87%	11.78%
Axis Nifty Midcap 50 Index Fund Direct Growth Compare	₹ 736	4 Yrs	-1.41%	0.10%	5.01%	9.78%	12.97%	17.30%	0.00%
Kotak Nifty Financial Services Ex-Bank Index Fund Direct Growth Compare	₹ 99	3 Yrs	-3.33%	-2.91%	5.60%	3.52%	10.72%	17.18%	0.00%
Motilal Oswal Nifty Microcap 250 Index Fund Direct Growth Compare	₹ 2,410	3 Yrs	-1.18%	3.81%	10.66%	25.31%	10.58%	17.02%	0.00%
Motilal Oswal Nifty Midcap 150 Index Fund Direct Growth Compare	₹ 3,911	7 Yrs	-1.77%	-0.05%	3.85%	7.87%	9.75%	16.46%	16.81%
Aditya Birla Sun Life Nifty Midcap 150 Index Fund Direct Growth Compare	₹ 487	5 Yrs	-1.78%	-0.06%	3.81%	7.78%	9.55%	16.33%	16.70%
Nippon India Nifty Midcap 150 Index Fund Direct Growth Compare	₹ 2,727	5 Yrs	-1.76%	-0.05%	3.83%	7.82%	9.66%	16.22%	16.59%
SBI Nifty Midcap 150 Index Fund Direct Growth Compare	₹ 1,212	3 Yrs	-1.77%	-0.05%	3.86%	7.85%	9.63%	16.21%	0.00%
Edelweiss Nifty Midcap150 Momentum 50 Index Fund Direct Growth Compare	₹ 1,743	3 Yrs	-1.69%	1.24%	2.65%	5.01%	5.40%	16.19%	0.00%
ICICI Prudential Nifty Midcap 150 Index Fund Direct Growth Compare	₹ 1,263	4 Yrs	-1.76%	-0.03%	3.85%	7.84%	9.65%	16.16%	0.00%
Navi Nifty Midcap 150 Index Fund Direct Growth Compare	₹ 398	4 Yrs	-1.76%	-0.06%	3.81%	7.77%	9.46%	16.11%	0.00%
HDFC NIFTY Midcap 150 Index Fund Direct Growth Compare	₹ 687	3 Yrs	-1.77%	-0.06%	3.83%	7.76%	9.50%	16.11%	0.00%
Tata Nifty Midcap 150 Momentum 50 Index Fund Direct Growth Compare	₹ 1,217	3 Yrs	-1.70%	1.23%	2.26%	4.61%	5.02%	15.61%	0.00%
HDFC NIFTY 100 Equal Weight Index Fund Direct Growth Compare	₹ 519	4 Yrs	-1.77%	-1.46%	2.84%	4.04%	6.69%	15.31%	0.00%
Edelweiss Nifty Smallcap 250 Index Fund Direct Growth Compare	₹ 262	3 Yrs	-1.07%	1.95%	7.99%	17.49%	8.77%	15.27%	0.00%
Sundaram Nifty 100 Equal Weight Fund Direct Growth Compare	₹ 147	13 Yrs	-1.75%	-1.45%	3.00%	4.31%	6.93%	15.21%	11.65%
Motilal Oswal Nifty Smallcap 250 Index Fund Direct Growth Compare	₹ 1,253	7 Yrs	-1.08%	1.94%	7.95%	17.31%	8.61%	15.18%	15.50%
Motilal Oswal BSE Financials ex Bank 30 Index Fund Direct Growth Compare	₹ 33	4 Yrs	-3.34%	-1.83%	8.66%	1.42%	7.55%	15.17%	0.00%
SBI Nifty Smallcap 250 Index Fund Direct Growth Compare	₹ 1,725	3 Yrs	-1.07%	1.94%	7.93%	17.30%	8.47%	14.94%	0.00%
HDFC Nifty Smallcap 250 Index Fund Direct Growth Compare	₹ 728	3 Yrs	-1.08%	1.93%	7.94%	17.29%	8.50%	14.92%	0.00%
ICICI Prudential Nifty Smallcap 250 Index Fund Direct Growth Compare	₹ 754	4 Yrs	-1.07%	1.94%	7.94%	17.28%	8.50%	14.92%	0.00%
Nippon India Nifty Smallcap 250 Index Fund Direct Growth Compare	₹ 3,391	5 Yrs	-1.07%	1.94%	7.94%	17.34%	8.57%	14.74%	15.25%
Motilal Oswal BSE Quality Index Fund Direct Growth Compare	₹ 59	4 Yrs	-2.19%	-2.05%	-1.21%	3.80%	2.91%	13.76%	0.00%
Edelweiss NIFTY Large Mid Cap 250 Index Fund Direct Growth Compare	₹ 348	4 Yrs	-1.57%	-0.84%	3.31%	3.14%	4.77%	13.10%	0.00%
DSP Nifty 50 Equal Weight Index Fund Direct Growth Compare	₹ 2,609	8 Yrs	-1.22%	-2.13%	1.61%	0.43%	4.33%	13.03%	12.07%
Aditya Birla Sun Life Nifty 50 Equal Weight Index Fund Direct Growth Compare	₹ 530	5 Yrs	-1.22%	-2.12%	1.59%	0.43%	4.30%	12.99%	11.96%
HDFC NIFTY50 Equal Weight Index Fund Direct Growth Compare	₹ 1,821	5 Yrs	-1.22%	-2.13%	1.53%	0.34%	4.22%	12.98%	12.02%

About Index Funds

Index Funds are passively managed mutual funds that aim to replicate the performance of a specific market index like Nifty 50, Sensex, or Bank Nifty. Instead of a fund manager actively picking stocks, the fund simply buys all the stocks in the index in the same proportion. This approach results in lower expense ratios compared to actively managed funds.

They track a specific benchmark index and aim to match its returns as closely as possible.
Lower expense ratios compared to actively managed funds since minimal research and stock-picking is involved.
Tracking error measures how closely the fund follows its benchmark – lower is better.
They provide broad market exposure through a single investment, offering instant diversification.

Index Funds are ideal for investors who believe in long-term market growth and prefer a low-cost, passive investment approach.

Index Funds offer several distinct advantages:

Low expense ratios since there is no need for active stock selection or frequent portfolio churning.
Transparency – you always know which stocks the fund holds since it mirrors the index composition.
Eliminates fund manager risk – performance is tied to the index, not individual decision-making.
Broad diversification across all stocks in the index through a single investment.
Historically, many actively managed funds have failed to beat their benchmark indices over long periods, making index funds a compelling choice.

These advantages make Index Funds particularly suitable for long-term, disciplined investors.

Consider these points before investing:

Index Funds work best with a long-term horizon (5+ years) as short-term market volatility can impact returns.
They won't outperform the market – by design, they aim to match the index, not beat it.
In sideways or declining markets, you cannot expect the fund manager to take defensive action as in actively managed funds.
Choose funds with low tracking error and low expense ratios for the best index-tracking experience.

Index Funds are a solid choice for investors who want market-level returns without the complexity of stock picking.

Index Funds are suitable for:

Long-term investors who believe markets will grow over time and want to participate in that growth cost-effectively.
Beginners who are new to mutual funds and want a simple, transparent starting point.
Cost-conscious investors who want to minimize expense ratios and maximize net returns.
Investors who prefer a passive, buy-and-hold strategy without worrying about fund manager changes or performance consistency.

If you have patience and a long-term outlook, Index Funds can be an excellent core holding in your investment portfolio.

FAQs

Index funds track a specific stock market index, like the Nifty 50, Bank Nifty or BSE Sensex. When you invest in an index fund, your capital is automatically spread across all the stocks in that index proportionately. This means you are investing in a segment of the market rather than picking individual stocks.

Index funds are typically invested in the stocks that make up a particular index. For instance, if the fund tracks the Nifty 50, it invests in the same companies and in the same proportions as this index, which includes top companies across various sectors in India.

Certainly, profits can be earned through an investment in an Index Fund. However, they carry risks like any other investment. Your returns depend on how the underlying index being tracked by the fund performs.

No, index funds are not tax-free. You'll need to pay taxes on any profits you make, which are subject to capital gains tax. The rate depends on how long you've held the investment.

To choose the right index fund consider things like: tracking error which shows how close a fund is following its benchmark; expense ratio – indicates how much is paid for mutual fund management; past performance – even though it can never guarantee future success.

Usually there are no lock-in periods applicable to Index Funds meaning that such schemes do not have restrictions on buying/selling capital units at any point in time. However, it's best to verify for that specific scheme.