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AMFI data reveals that women investors are more likely to stay invested if they invest in mutual funds through regular plans.
The data shows that 17% of the total SIP assets in regular plans of women investors has been active for over 5 years. Such a proportion was 4% in direct plans.
AMFI said, “The importance of handholding is also corroborated by the holding period data of women investors in systematic investment plans (SIPs). Data shows women investors are parking their funds in regular SIPs, at 17% in both B30 and T30 cities, for more than five years compared with 3-5% for direct plans in these regions respectively.”
“Investing in mutual funds can be a complex exercise. Hence, it is paramount that domain experts, i.e., professional financial experts, guide investors to the product most suited to their requirements. Further, most individual investors tend to exit when markets are volatile; hence, handholding of the women investors is important to provide studied guidance to prevent a knee-jerk reaction,” said AMFI.
Noida MFD, Akta Sehgal, Founder of Manas Wealth feels that many women like to work with experts for money management. She said, “I feel that humans want to try new things and with media popularizing direct plans, they do gain traction but as soon as people see markets not performing well, they get tense and that’s where they seek professional help from the MFDs and financial advisors.”
Neelesh Verma, AVP and Product Head, Coin by Zerodha is of the opinion that understanding of mutual funds is very limited among people and hence, they aren’t able to sustain in direct plans for long. He said, “People don’t have much knowledge of risk appetite and asset allocation when they invest in mutual funds and when they join the direct plan, they are not able to foresee risky events.”
Mumbai MFD, Roopa Venkatkrishnan, Director Sapient Wealth Advisors & Brokers and Secretary, FIFA feels that direct options are for informed investors and won’t suit everyone. She said, “In the last 25 years, when direct plans were not there, people still made wealth. Especially women are more prudent while investing and hence, they don’t mind taking assistance. They are open to seek help when they don’t know something.”
Varun Gupta, CEO, Groww MF believes that women investors investing in regular plans are more, as they need more guidance. He said, “In direct plan, the investors need to possess conviction and knowledge, which is currently lacking so MFDs provide that guidance to women to hold their SIPs for long tenure.”
