Published Paper Details:

This research analyses the ongoing discourse regarding active and passive investment strategies within the Indian stock market. Through an analysis of key performance metrics (Sharpe ratio, Treynor ratio, standard deviation, tracking error) and consideration of cost factors (expense ratios, fees), the study compares the performance, risk, and cost implications of these two approaches. While active management presents the potential for outperformance, particularly in less efficient market segments, it is associated with higher risks and costs. Conversely, passive management, implemented through index funds, offers stable, predictable returns with lower risk and cost, rendering it appropriate for risk-averse investors and efficient market segments. The selection between active and passive strategies ultimately depends on individual investor characteristics such as risk tolerance, investment horizon, and financial objectives.