Ghosted indices: mutual funds generally ignore niche themes of exchanges, consider them too risky

Stock exchanges have launched many niche thematic indices, but mutual funds and AMCs largely ignore them, considering them too specialised and risky for broader investor participation. Of NSE's 61 niche indices, only 23 are used as benchmarks by mutual funds or tracked by passive funds, while on BSE, just 7 of 26 niche indices have seen adoption. Indices like Nifty Waves, Nifty Sugar and Ethanol, and conglomerate-specific indices such as the Tata Group and Mahindra Group indices have not attracted any fund launches, though a few niche indices like the Nifty200 Momentum 30 have scaled sharply once a theme gained traction.