There is a good news for the mutual fund industry. The participation of retail investors in the mutual fund industry has increased by 50% to reach Rs.9.28 lakh crore. Retail AUM now constituted almost half of the overall AUM of Rs.19.28 lakh crore.
Rising retail AUM is a healthy sign for the industry as retail investors stay put for long term compared to institutional investors.
Of the Rs.9.28 lakh crore retail AUM, Rs.2.33 lakh crore or 25% came from B15 cities as on April 2017.
Another good sign for the industry is increasing participation of retail investors in equity funds.
The AUM in retail investors in equity funds increased by 50% year-on-year to Rs.6.62 lakh crore in April 2017 shows AMFI data. With this, retail equity AUM now constitute 94% of the overall equity AUM of the MF Industry.
Experts attribute this to rise in inflows through SIPs. “Equity funds have done well over the years. In addition, people are confident because of GST and other economic reforms. The confidence of the retail investors can be seen from the fact that a lot of investment are coming through SIPs in equity funds,” said Radhika Gupta, CEO of Edelweiss Mutual Fund.
The investor appetite for equities can also be derived from the fact that the number of folios under equity schemes increased by 17% from 3.87 crore folios in April 2016 to 4.51 crore in April 2017. Overall, the retail folios for the month stood at 5.46 crore.
