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A study by Zerodha Capital MF shows that more than 50% of the new investor folios added by the mutual fund industry have come from B30 cities.
However, despite this, B30 cities constitute about 19% of the overall MF AUM. This indicates that the investments coming from these cities have lower ticket sizes, said the fund house.
The fund house has attributed the rise in folios in B30 cities to the increase in SIP accounts. In fact, B30 cities account for 54% of the total SIP accounts of the MF industry as of August 2024. 79% of these SIPs are in equity schemes.
The number of folios in B30 cities have also increased from 8.29 crore to 9.52 crore.
Another interesting trend highlighted by the study is that, between April and August 2024, index funds have seen the highest growth in SIP accounts of 18.7% compared to any other category. Liquid and overnight funds have seen the second highest growth at 18.6% while debt schemes are third with a growth of 16%.
Vishal Jain, CEO, Zerodha Capital MF said, “I strongly believe that simple, transparent and affordable products will help individual investors design better financial futures. Index-based products exhibit all these qualities and I’m heartened to see their growing trend in smaller cities and towns.”
Overall, the average ticket size of the retail segment in smaller cities is about Rs. 1.13 lakh while the combined average ticket size of the retail segment for (T30+B30) cities is about Rs. 2.04 lakh.
