Retail participation in mutual fund industry has been increasingly though marginally. AMFI’s latest data shows that the retail investors account for 23% of the total industry AUM as on September 2017.
In September 2016, retail AUM of the MF industry was at 21% of overall industry AUM indicating an increase of 2% in retail participation.
Retail AUM has increased by 41% in one year, shows AMFI data. The data shows that the retail AUM rose to Rs.4.69 lakh crore in September 2017 from Rs.3.31 lakh crore in September 2016. During the same period, the overall AUM has increased by 29%.
The data also shows that retail participation in the equity funds has increased 44% in the last one year. It increased to Rs.3.80 lakh crore as on September 2017 from Rs.2.63 crore in September 2016.
Experts attribute this increase to the increasing appetite for equity funds and the growing popularity of SIP among retail investors. They also say that rising retail AUM is a healthy sign for the industry as retail investors stay put for long term.
If we compare the retail equity AUM to the overall equity AUM, it accounts for 45% of the overall equity AUM. The total equity AUM of the industry was at Rs.8.49 lakh crore in September.
We have included pure equity, ELSS, balanced funds, and equity ETFs as equity funds.
Among equity funds, pure equity funds witnessed the highest change in retail AUM. The retail AUM of pure equity fund by increased by Rs.71,154 crore from September 2016 to reach Rs.2.69 lakh crore.
However, in terms of percentage, balanced funds saw the highest change in the AUM. Retail AUM in balanced funds increased by 124% to Rs.46,433 crore in September 2017. The retail AUM in balanced funds stood at Rs.20,745 in the corresponding period last year.
Experts attribute it to the relatively smaller base of balanced funds. Also, many investors have started putting money in balanced funds as they have the potential to give more attractive returns than debt funds with the tax efficiency of equity funds.
Also, many distributors have been promoting balanced funds among first time investors to make them comfortable with mutual funds.
Debt schemes are also catching the eye of retail investors. AUM under open-ended debt schemes except gilt funds stood at Rs.68,325 crore. It increased by over Rs.18,000 crore in the past one year. This constituted nearly 10% of the industry’s income funds.
Experts say that investors are looking for other avenues after the reduction of interest rates of fixed deposits. Distributors typically suggest debt funds as an alternative for fixed deposits to investors with low risk appetite.
Retail AUM under various categories
|
Scheme Category / Scheme Name |
September 2017 |
September 2016 |
Difference |
Difference % |
|
Equity |
2,69,469.50 |
1,98,315.8 |
71,153.75 |
35.88 |
|
Balanced schemes |
46,433.02 |
20,745.15 |
25,687.87 |
123.82 |
|
ELSS |
60,785.88 |
43,379.58 |
17,406.3 |
40.12 |
|
Other ETFs |
2,020.77 |
637.21 |
1,383.56 |
217.13 |
|
Other Debt Schemes |
68,325.25 |
50,218.95 |
18,106.3 |
36.05 |
|
Gilt |
1,667.44 |
899.56 |
767.88 |
85.36 |
|
FMP |
11,544 |
9,244.44 |
2,299.56 |
24.87 |
|
GOLD ETF |
1,168.52 |
1,289.77 |
-121.25 |
-9.40 |
|
Fund of funds investing overseas |
557.37 |
534.18 |
23.19 |
4.34 |
|
GRAND TOTAL |
4,68,954.7 |
3,31,546.7 |
1,37,407.94 |
41.44 |
Source: AMFI
Figures in Rs.crore
