New Delhi, Feb. 21 -- Investors in India are now keenly searching for passive investments, this trend is gaining traction as the short term equity market returns are starting to wane due to consistent Foreign Institutional Investors (FII) selling.

That is why it will be reasonable to know what Index Funds and Exchange-Traded Funds (ETFs) are and what are several important differences between them.

Further, though they both invest aiming to replicate the performance of definite market indices. While in objectives they are almost identical, regarding form, trading mode, and price, they differ as much as chalk and cheese.

ETFs are traded on the share market like shares, and they may be bought or sold during the day at prevailing market pr...