Even as the Indian equity market remains volatile, retail investors continue to favour equity mutual funds. The latest data from the Securities and Exchange Board of India (Sebi) shows that in the month of February, 3.82 lakh new folios were added in equity oriented schemes. Steady participation from investors can be attributed to a series of new fund offers (NFOs) launched in the past few months and strong performance of equity funds.
The data from Sebi also shows that the mutual fund industry added 16.14 lakh folios in equity oriented schemes during April-February 2015 while the overall industry saw the folio count rise by 19.87 lakh folios during April-February 2015. As on February, 2015 total folio of equity oriented schemes stands at 3.11 crore, while the figure for the mutual fund industry as a whole, was at 4.11 crore.
Vikaas Sachdeva, CEO at Edelweiss Asset Management Company (AMC) says, “The work of the mutual fund industry on investor education and awareness programmes is finally getting noticed. The numbers tell that, mutual fund industry are adding new investors every month.” In 2012, Sebi had asked fund houses to set apart at least 2 basis points on daily net assets within the maximum limit of total expense ratio, for investor education and awareness programmes. He also added that, folios from B-15 cities have also overtaken top 15 cities and this is because fund houses have been able to reach a wider audience in semi urban and rural areas of the country.
The Indian mutual fund industry crossed the 12-lakh-crore mark in February, 2015 showed the data from Association of Mutual Funds in India (Amfi). Equity funds continued to attract money and in February it saw net inflows of R5,217 crore. While the assets under management of the industry stood at R12,02,196 crore as on February 2015.
Euity funds continue to see new inflows month after month following strong equity markets. “In the past few months we have seen continuous flows from retail investors. Though most investors seem to prefer existing schemes, even NFOs are attracting new investors. There has been a steady rise in the systematic investment plans (SIPs) for equity funds. We hope they continue to invest and not exit when there is correction in the equity markets,” said a marketing head of the top fund house.
Fund houses have also lined up new offers to attract more investors into equity funds, but the real test of the mutual fund industry would be when markets move lower and investors start redeeming money from equity funds.
Taking the equity route
* 3.82 lakh new folios were added in equity oriented schemes in February alone
* Overall industry saw the folio count rise by 19.87 lakh folios during April-February 2015
* Steady participation from investors can be attributed to a series of NFOs launched in the past few months and strong performance of equity funds