New Delhi, Feb. 27 -- Passively managed funds have been growing in popularity with exchange-traded funds (ETFs) and index funds accounting for Rs.1.31 trillion worth of net inflows over the past one year. While passive investing should be approached in the same disciplined way as any other form of investing, long-term wealth creation should be built around broad market indices rather than thematic passive funds, says Hemen Bhatia, executive director and chief executive officer of Angel One Asset Management Company.

In an interview with Mint, the former member of the team at Benchmark AMC that pioneered passive investing in India shares insights into the nuances of investing in passive funds. Edited excerpts.

Passive investing should be ...