indian-etf-market-doubles-aum-in-three-years

India’s Exchange Traded Fund (ETF) industry crossed a major milestone in October 2025, with Assets Under Management (AUM) exceeding ₹10 lakh crore, reflecting a sharp shift in investor preference towards low-cost and transparent investment products, according to Zerodha Fund House.

 

Over the past three years, the ETF ecosystem has doubled its total AUM. Trading activity has also surged, with volumes in FY 2024-25 rising more than seven-fold from ₹51,000 crore in 2019-20 to ₹3.83 lakh crore. The momentum has continued into 2025-26, with trading volumes in the first half of the financial year already surpassing ₹3.2 lakh crore, nearly matching last year’s full-year total.

 

Higher liquidity has contributed to tighter spreads, better price discovery, and smoother trade execution, analysts noted. Retail participation has been a key driver of growth. The number of ETF folios grew from about 41 lakh in November 2020 to over three crore by November 2025, supported by digital platforms and rising investor awareness.

 

“For new investors, ETFs act as a versatile tool to take exposure to different asset classes, themes, and segments since they are simple, cost-effective and transparent in their structure,” said Vaibhav Jalan, CBO, Zerodha Fund House.

 

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Equity ETFs continue to dominate, accounting for 25 lakh new folios in the last year. However, investors are gradually diversifying, with gold and silver ETFs now representing nearly 15 per cent of total AUM. Gold ETF AUM doubled in the past year to cross ₹1 lakh crore, while silver ETF AUM quadrupled to over ₹49,000 crore, highlighting rising interest in precious metals for portfolio diversification.

 

“Crossing the ₹10 lakh crore AUM mark is a landmark moment for the Indian ETF space. Having launched India’s first ETFs across equity, gold, liquid, and government divestment categories, it is satisfying to see the product mature and gain such widespread adoption,” said Vishal Jain, CEO, Zerodha Fund House.

 

The growth story underscores a broader trend of investors moving towards low-cost, transparent products in India’s capital markets. With continued digital access, increasing retail participation, and expanding product diversity, ETFs are poised to remain a preferred investment vehicle in the coming years.