AUM stands for Assets Under Management. It is the total amount of money a mutual fund, or an entire fund house, is currently managing on behalf of all its investors put together. If ten lakh people have invested a combined ₹5,000 crore into a fund, that fund's AUM is ₹5,000 crore. It's essentially a size indicator — the bigger the AUM, the more money the fund is responsible for investing wisely.
A large AUM can be reassuring because it suggests many investors trust the fund, and it often means lower costs since expenses are spread across more money. However, a very large AUM can also make it harder for a fund manager to move quickly in and out of smaller, high-growth stocks. AUM by itself doesn't tell you whether a fund is good or bad — it's just one data point to consider alongside past performance and consistency.