Kotak Nifty Financial Services Ex-Bank Index Fund - Direct Plan - Growth option

Kotak Nifty Financial Services Ex-Bank Index Fund - Direct Plan - Growth option ranks among the stronger performers in the Index Funds category, backed by a 5-star rating. TopFund's composite Health Score, which weighs rating, 3-year CAGR, expense ratio and fund size, puts it at 88/100.

Cost: At 0.21%, the expense ratio is meaningfully cheaper — about 48% below the Index Funds category average of 0.4% (based on 908 comparable funds). Lower costs compound in your favour over long holding periods.

Risk-adjusted performance: Over the trailing 1-year period, the fund shows a modest Sharpe ratio of 0.18 — returns have only marginally compensated for the risk taken. Separately, with 20.84% annualised volatility, this is among the more turbulent funds in its space — expect sharp swings in both directions.

Who should invest: This fund is best suited to cost-conscious investors happy to simply match the market rather than try to beat it. The High risk rating means near-term volatility should be expected — this isn't a fund to check daily.