Over half of retail equity assets remained invested for over two years, shows the latest AMFI data. Of Rs. 2.45 lakh crore retail equity assets as on June 2016, 53% or Rs.1.30 lakh crore remained invested for more than 24 months.
Traditionally, retail investments are known to be sticky unlike institutions who book profits at regular intervals.
A major chunk of retail investors invest through SIP. Nilesh Shah, MD & CEO, Kotak MF had earlier told Cafemutual that the mutual fund industry has been receiving inflows of Rs.2,800 crore per month in equity funds through SIPs. All this money is long term in nature. This is due to effort of AMCs and IFAs who have created awareness about benefits of investments through SIPs.”
In non-equity assets too, 47% or Rs. 28,884 crore of Rs. 60,882 crore retail assets have holding period of over two years.
Interestingly, FIIs also held a major chunk of investments for more than two years. Of the Rs. 2,787 crore held by FIIs in equity funds, 68% or Rs. 1,885 crore remained invested for more than two years. Banks also held Rs. 1,852 crore or 30% of their total equity investments (Rs. 6,123 crore) for more than two years. The prospects of Indian economy doing well has made FIIs invest for a longer time horizon, say industry officials.
However, the holding period of corporate, banks and FIIs in debt funds is for a much shorter horizon. Typically, FIIs and banks are short term investors.
