Retail investors’ mutual fund assets spiked nearly 50% in past one year: AMFI data

Investing in mutual funds is believed to be a good financial decision and is often recommended by wealth advisors as safe for individual investors. By virtue of being managed by experts, mutual funds offer more stable returns minus volatility vis-a-vis individual stocks. No wonder then that the overall asset size of the mutual fund universe has been growing at a fast pace month after month.

The latest data released by the Association of Mutual Funds in India (AMFI) reveals that investment by retail investors has jumped significantly in the past one year.

Sample this: The value of assets held by retail investors in mutual funds rose from ₹28.10 lakh crore in September 2023 to ₹42.10 lakh crore in September 2024, an increase of 49.82 per cent.

Another point worth considering is that most of the fresh investment in mutual funds was made in equity schemes. However incredible it may sound, the data suggests that a whopping 87 per cent of individual investor assets are held in equity-oriented schemes (Industry Trends September 2024).

On the other hand, 51 per cent of mutual fund assets owned by institutional investors are held in liquid or money market schemes and debt-oriented schemes.

Let us examine this data from a different angle. Equity-oriented schemes draw 88 per cent of their investment from individual investors, including retail and HNIs (high net-worth individuals). Institutional investors, on the other hand, dominate liquid and money market schemes (88 per cent), debt-oriented schemes (63 per cent) and ETFs, FOFs (89 per cent).

Now the proportionate share of equity-oriented schemes is 61 per cent of the industry assets in September 2024, up from 54.1 per cent in September 2023.

Institutional investors

AMFI data (Industry Trends for Sep 2024) reveals that institutional investment has also spiked significantly in the past year. The value of institutional assets jumped from ₹19.69 lakh crore in September 2023 to ₹25.90 lakh crore in September 2024, reporting an increase of 31.56 per cent.

When it comes to overall assets, institutional investors account for 38.1 per cent, corporates hold 95 per cent, and Indian and foreign institutions and banks account for the rest.

The remaining assets in the mutual fund universe (i.e., 61.9 per cent) are held by individual investors in September 2024, as compared to 58.8 per cent in September 2023.