The Mutual Fund industry has added over 72 lakh folios to the market in the financial year, which took the total count to near 9 crores! However, the growth rate for these folio numbers did drop in the recently concluded financial years, when compared to the preceding fiscal years. This suggests how the understanding of the investors with regards to the market risks that are associated with such schemes has grown in the recent past.
As per industry experts, this decline in investor accounts in debt oriented schemes can be attributed to credit events in the fixed income market.
To compare this data with that of the previous years, the industry had added 1.13 crore investor accounts in the year 2018-19; while 1.6 crore accounts were added in the year 2017-18, as per the data from the Association of Mutual Funds in India. Additionally, 67 lakh folios were added in 2016-17, while 2015-16 witnessed the addition of 59 lakh folios.
As per data, the total number of folios with 44 fund houses increased to 8.97 crores by the end of March 2020, from the figure of 8.24 crores in March 2019, which had registered a gain of 72.89 lakh folios.
Folios are numbers that are designated to the investor account of an individual, and a single investor is allowed to have multiple folios.
It cannot be denied that the addition of these folios indicated how the investors have understood the various market risks that come attached to the mutual fund schemes. While investor account in equity-related schemes increased by over 15 lakhs to reach a total of 6.44 crore at the end of the financial year from 6.29 crores in March 2019; the count for folios in debt oriented schemes fell by 45 lakhs to just 71.78 lakhs. Looking at the figures within the debt category, liquid funds have continued to top the charts concerning folio numbers.
At the end of March this year, the 44-player mutual fund industry has assets under management (AUM) worth INR 22.26 lakh crore, while the same figure stood at INR 23.8 lakh crore in March 2019.