ETF AUM Soars 5x In Five Years; 80% of ETFs Fuelled By Equity ETFs; Where Does Silver, Gold, Debt ETFs Stand?

Exchange Traded Funds (ETFs) in India have surged phenomenally over the past five years driven by growth of equity ETFs and heightened retail investors. ETFs' Asset Under Management (AUM) has grown by nearly 5.5 times in five years. Growing popularity of ETF instruments during the period coincided with the introduction of multiple products in the category like silver ETFs, gold ETFs, etc.

The total AUM of ETFs in India has surged by over 5.5x over the last five years from March 2020 to March 2025 indicating a consistent growth of one of the instruments for the diversified investment portfolios, revealed Zerodha Fund House's study on Wednesday.
"The ETF landscape in India has witnessed substantial expansion in this period. The near tripling of the total number of ETFs available in India reflects a significant increase in the variety of investment instruments. This expansion includes the introduction of new commodity ETFs backed by Silver in 2022, broadening the options available to investors," read Zerodha Fund House's press release.

ETF Surge Led By Strong Retail Investors Participation

The phase of the massive expansion of the ETF AUM coincided with the expansion of the retail investor AUM. The retail investor AUM increased from Rs 5335 crore in March 2020 to Rs 17,800 crore in March 2025.

There has been a whopping tenfold increase in the number of retail investor folios in ETF schemes to 2.63 crore till March 2025 from merely 23.22 lakh in March 2020. The growth of ETF investment instrument is led by strong retail participation. As per the survey nearly 97% of all ETF investor folios are from the retail segment which indicated a broadening awareness and understanding of ETFs.

Surge in ETF Trading Volume

There has been a significant surge in trading volume of ETFs in India which more than doubled in the last one year. The trading volume of ETFs in India has skyrocketed by more than 7 times from Rs 51,101 crore in FY19-20 to Rs 3.83 lakh crore in FY 2024-25.
"This study highlights the new era for Indian ETFs, marked by surging retail participation and expanding product diversity reflected in higher resultant volumes," said Vishal Jain, CEO, Zerodha Fund House.

Equity ETFs Top Contributor In Growth, Followed by Debt, Gold And Silver

While ETFs offer a more stable and diversified option for investment in equities, it also offers investment avenues in commodities like gold and silver. Despite multiple options, equity ETFs continued to attract a larger investor base in last five years.

According to the report, 80% of the ETF AUM was driven by equities segment. As per the report, out of the total ETF AUM, Rs 6.67 lakh crore is invested in equities, followed by an investment of Rs 0.97 lakh crore in debt, Rs 0.59 lakh crore in gold and Rs 0.15 lakh crore in silver.

What is An ETF?

An ETF, known as Exchange Traded Funds (ETFs) is a mutual fund scheme that trades like a stock on a stock exchange, unlike mutual funds that can be purchased from platforms. ETF investment holds a collection of assets like stocks, bonds, or commodities and trades on a stock exchange.