Mutual funds: Now retail investors own 60% of total assets, shows AMFI data

Upon observing the recently-released AMFI data, one can promptly infer that the spike in mutual fund investment is an outcome of growing investment by retail investors, most of whom opt for equity schemes. It appears quite evidently when the data shows that equity-oriented schemes derive 89 percent of their assets from individual investors.

Assets managed by the mutual fund industry spiked from ₹40.76 trillion in Dec 2022 to ₹51.09 trillion in Dec 2023, reflecting 25.34 percent increase in assets over the past year.

One of the most upbeat observations is that the equity schemes comprise 56.5 percent of the total assets vis-a-vis 51.6 percent in Dec 2022.

Conversely, the share of debt-oriented schemes has fallen from 19.1 percent in 2022 to 17.5 percent in Dec 2023.

In fact, the ETF market share also saw a decline from 13.3 percent in Dec 2022 to 12.9 percent in Dec 2023.

Emergence of retail investors

One of the most positive changes the mutual fund industry saw relates to investment by retail investors. Individual investors held 60.1 percent in Dec 2023, as compared to 57.8 percent in Dec 2022.

On the other hand, institutional investors account for 39.9 percent of assets, out of which corporates are 96 percent while the remaining are Indian and foreign institutions and banks.

Another interesting trend is that equity-oriented schemes derive 89 percent of their assets from individual investors (retail + HNIs).

On the other hand, some schemes are dominated by institutional investors which control 90 percent of assets in fund of funds and 86 percent in money market schemes.

The same figures can be viewed differently. Sample this: Nearly 83 percent of individual investor assets are held in equity-oriented schemes while 54 percent of institutions' assets are held in liquid/ money market schemes and debt schemes.

These trends stemmed from 30.33 percent increase in assets held by retail investors in the past one-year vis-a-vis an increase of 18.51 percent of assets held by institutional investors.