During the first two months of the financial year 2024-25 (April and May), the mutual fund industry gained over 81 lakh new investors.
This increase is credited to ongoing marketing efforts, celebrity endorsements, and improved distribution network performance.
The stock market’s strong performance is also attracting more investors towards mutual funds, as they offer better returns compared to fixed deposits.
This shift in perception highlights that fixed deposits are no longer as lucrative as mutual funds in terms of returns.
The number of mutual fund folios in the industry stood at 18.6 crore at the end of May
Based on data from the Association of Mutual Funds in India (AMFI), the mutual fund industry had 18.6 crore folios by the end of May.
This marks a 4.6% increase, adding 81 lakh more folios compared to March’s 17.78 crore.
It’s important to note that this figure represents individual investor accounts, and AMFI clarifies that investors can hold multiple folios.
It is expected that similar growth will continue in the mutual fund industry in future as well
Trivesh D, the COO of Tradejini, a stock trading platform, mentioned that the mutual fund market’s outlook has improved.
Factors like the ongoing stock market boom, enhanced risk management, investor education, and effective marketing strategies have attracted more investors to mutual funds.
This growth trend is expected to continue in the future as well, as investors recognize the long-term growth potential of mutual funds.
Abhishek Tiwari, the CBO of PGIM India Mutual Fund, also noted that as India’s per capita income rises, investors will increasingly turn to mutual funds to combat inflation and build wealth. This will expand the reach and popularity of mutual funds in the market.
The number of young investors coming through digital channels is high
AMFI reports a significant influx of new investors primarily through digital platforms, with a notable presence of young individuals.
Of the 81 lakh new folios, around 61 lakh are in equity-based mutual funds, pushing the total number of such folios to 12.89 crores.
This surge is attributed to the stock market’s strong performance in recent years. Additionally, sectoral and thematic funds have also experienced remarkable growth.
