The rise of passive funds could be attributed to the whopping rise in the number of demat accounts in the last two years. Last week, Ajay Tyagi, who is the chief of the capital market regulator, Securities and Exchange Board of India (Sebi), said at a National Stock Exchange (NSE) event: “In line with the global trend, India has seen a significant increase in the number of individual investors accessing the capital markets. From an average of 4 lakh new demat accounts opened every month in 2019-2020, it tripled to 20 lakh per month in 2021 and has further increased to around 29 lakh per month till November of the current financial year. That is more than seven times of the monthly average (in) the pre-Covid year of 2019-2020. In fact, the cumulative (number of) demat accounts, which stood at 3.6 crore as on March 2019, (was) 7.7 crore as at end of November 2021.” He also added that as of November 30, 2021, there were 16 exchange-traded funds (ETFs) benchmarked to the Nifty 50 index with total AUM of more than Rs 1.6 lakh crore. In addition, there are seven international ETFs based on Nifty 50 with a total AUM of more than $1 billion.