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A recent study done by Kuvera.in, a direct plan mutual fund distributor reveals that 51% Indians invest in mutual funds simply to create wealth. They don’t have any financial goals in mind.
The study further shows that 45% of the total respondents invest in mutual funds by keeping some financial goals in mind like retirement or children education. Just 2% invest in mutual funds for tax savings, shows the research.
However, the findings show different results when we distribute the results across age groups. While 55% respondents in the age group of 36-45 invest in mutual funds to achieve their financial goals, 59% in the age group of 44 and above invest to grow their wealth.
Region-specific trends show that investing for ‘financial goals’ is important for people in Chennai (62%) and Hyderabad (52%) while growing wealth appealed to most in Delhi (61%), Ahmedabad (55%), Bengaluru (54%), Kolkata (53%) and Mumbai (53% percent).
Among other key findings are:
- Index funds are yet to pick up as only 25% of the total respondents invest in them
- 5 out of 10 women do SIP of more than Rs.10,000. Interestingly, 61% of the total male respondents do SIPs of over Rs.10,000
- A good 79% of those at 44 years and above prefer growth funds
- 11% and 6% of respondents younger than 25 years of age prefer sector funds and value funds, respectively
- 43% said past performance of the fund is a key determinant for investing in mutual funds
- 50% looked at other criteria like reputation of the fund house, fund criteria and fund manager’s investment style to select funds
- Just 1% of respondents track all these determinants to select funds
- Respondents in south India - Chennai, Hyderabad and Bengaluru accord more importance to the fund house, fund criteria and fund manager’s investment style over past performance
The survey comprised a list of eight questions in which 5,559 people participated with 1028 from Delhi, 912 from Mumbai, 524 from Bengaluru, 476 from Kolkata, 420 from Chennai, 360 from Hyderabad, 188 from Ahmedabad and 444 from Pune. There were 528 women respondents. 47% percent of survey respondents fell in the age group of 25-35 while 26% percent were in 36-43 age bracket. The rest were below 25 years of age or 44 and above.
