The past fiscal year witnessed remarkable performance in the Indian equity market, with all the equity indices showing gains. However, what truly stole the spotlight were the broader market indices and public sector undertakings (PSUs). This bullish trend in the equity market was mirrored in the inflows into equity mutual funds. Last year, dedicated equity mutual funds experienced a net inflow of ₹1.84 lakh crore, marking a significant 25 per cent increase from the previous fiscal year’s inflow of around ₹1.49 lakh crore.
Another notable trend in the mutual fund landscape is the rising popularity of exchange-traded funds (ETFs). ETFs, which track benchmark indices, offer returns closely aligned with market performance. The assets under management (AUM) of index ETFs surged from ₹50,211 crore in FY17 to ₹695,205 crore as of March 2024, reflecting an impressive annualised growth rate of over 50 per cent. This growth in AUM can be attributed partly to the rising equity indices, contributing to mark-to-market gains.
During the same period, key indices like Nifty and Sensex demonstrated compounded annualised growth rates (CAGR) of 18 per cent and 20 per cent, respectively, while BSE 500 saw a CAGR of 20 per cent. The difference in the growth rate between the ETF’s AUM and indices clearly underscores the continued strength of inflows into ETFs. Over the past eight years leading up to FY24, ETFs attracted a cumulative inflow of ₹3.74 lakh crore, accounting for nearly 50 per cent of the current ETFs AUM. Notably, a significant driver of this increase is the participation of the Employees’ Provident Fund Organisation (EPFO) in equity investments through passively-managed ETFs.
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
How To Invest In An Ageing Bull Market
Bull rallies (periods when stock prices rise) and bear declines (periods when stock prices fall) are natural parts of stock market cycles, but they don't follow a fixed timeline.
Should You Entrust All Your Money To A Single AMC?
If you are a market participant, you have probably heard the quote 'don't put all your eggs in one basket', which suggests diversification. Investors often focus on diversifying across categories like large-cap, mid-cap and small-cap, but they may unintentionally overlook diversification across different AMCs. The question arises: is AMC-wise diversification really necessary? Rakesh Deshmukh takes a closer look at this scenario
Wild Swings Engulf Global Equities
U.S. stock markets experienced significant volatility. An early-week rally pushed the markets to new highs, but this momentum faded, primarily due to weaknesses in the tech sector. The major indices had a mixed finish with, S&P 500 and Nasdaq closed lower, while the Dow recorded a notable gain.
U.S. Elections and China's Economy Hamper Commodities
Commodity markets experienced selling pressure in the last fortnight, driven by uncertainties surrounding the upcoming U.S. presidential elections, concerns about the Chinese economy, and increased agricultural production in Brazil.
Wealth Building For Retirement Through Mutual Funds
Retirement is one of the most crucial and lifechanging phases. It marks a period where maintaining your lifestyle becomes paramount even though your regular income stops.
Mastering Investment with Information Ratio
Information Ratio helps in navigating the complexities of the investment landscape by assessing an active fund manager's performance. And though it has its limitations, it remains an essential part of the finance industry. The article explains what Information Ratio is and how investors can use it as another tool
Plan To Be Financially Independent
Each of us aspires to be financially independent as it ensures having enough resources to be self-sufficient and control our finances.
❝Technology is the new game-changer"
With a new breed of young investors entering the financial markets, it is the use of technology that is increasingly playing a major role in how investments are done and tracked. Anand Radhakrishnan, Managing Director, Sundaram Mutual Fund, shares his opinion about how this factor is turning into a significant tool and how it will shape the strategies of his company
What If Donald Trumps?
The potential election of Donald Trump as president in the U.S. carries significant implications for the Indian equity market. It could lead to changes in the global trade dynamics, in particular affecting the Indian IT sector while also raising inflation levels and leading to yet another revision in the visa programme for Indians who want to work in the US. The article takes a closer look at what may lie in store
Sectoral Gains Make A Mark
Benchmark indices continued their uptrend, reaching new record highs, although the pace has slowed as the broader markets faced selling pressures