Rayner Spencer Mills Research (RSMR) has created a list of 32 passive funds for investors, across Investment Association sectors, assessing each fund in areas such as compliance procedures and risk management.
Chris Riley, investment research manager for the research firm, said: “Passive management is becoming a more popular choice for advisers when creating portfolios for their clients.
“Many now consider a mix of tracker funds or passives, which can compliment actively managed funds or investment trusts in certain areas.”
However, he warned there could be a lack of quality research explaining how to use passive funds effectively and how to ensure appropriate due diligence is in place.
William Hunter, director of Edinburgh-based Hunter Wealth Management, said: “The industry is getting very focused on costs but when it comes to considering actives and passives, one could go up while the other goes down, so it is good to have a foot in both camps.”