Retail and HNI folios in liquid funds witness an increase, shows AMFI data
Liquid funds are gradually finding favour among retail investors. As per AMFI data, retail investor folios in liquid funds increased from 1.61 lakh in September 2011 to 1.67 lakh in September 2012. Their assets size in liquid funds increased marginally from Rs 827 crore in September 2011 to Rs 1003 crore in September 2012.
Lately, the industry and the regulator have been asking fund advisers to bring new retail investors in simpler products like liquid funds first and subsequently in more complex products like equity funds. Advisers too have seen that once retail investors burn their fingers in equities, they are reluctant to enter the market again. This is perhaps the reason for them to shift focus towards debt funds like FMPs and bond funds which have been giving decent returns in the current high interest regime.
“It is a misconception that liquid funds are only meant for large investors. Liquid funds are an ideal alternate for bank fixed deposits as they offer liquidity and returns,” says an operations head of a mid-sized fund house. Liquid funds AUM stood at Rs 1.46 lakh crore as on September 2012, a majority of which is corporate and bank money.
SMS investments introduced by fund houses recently has proved to be a convenient way for investors to park their surplus cash in liquid funds, say advisers. “Liquid funds are providing good returns and SMS facility launched by fund houses has also been very helpful. In the last one year we have mobilised more than two crore in liquid funds from retail investors. We introduce liquid schemes to first time mutual fund investors because the returns are always positive,” says Gajendra Kothari of Etica Wealth Management.
Debt funds, once largely popular among corporates, are finding favour with retail investors. Retail debt folios jumped from 42.32 lakh in September 2011 to 49.82 in September 2012, adding 7.50 lakh folios.The trend is similar among HNIs. Overall, debt funds added more than eight lakh folios.
Gold
funds are also steadily adding folios and the positive trend is likely to
continue due to the festive season when demand for gold sees a spike. Gold ETF
folios jumped to 4.75 lakh in September 2012 from 4.12 lakh in September 2011,
an increase of 62469 folios.The AUM of gold ETFs increased to Rs 11,199 crore in
September 2012 from Rs 8184 crore in September 2011. Since the prices of gold
have peaked, fund advisers are cautioning investors not to invest more than 5%
of their portfolio in gold and that too only through SIPs. Investors have taken
advantage of the recent correction in equity market to move out of equity funds.
