Slowly and steadily, mutual funds are becoming the preferred route of investment by individuals in India.
The year 2018 saw the assets under management (AUMs) of domestic mutual fund companies increasing by almost 14 per cent in the first 11 months of 2018. This was primarily led by the growth in number of investors, which is estimated to have grown by 1.32 crore during the same period. The interesting part is that the retail investors have contributed in a big way in this increase. They now form more than 50% of the total AUMs of mutual fund industry.
The mutual fund industry on an average has witnessed an addition of around 10 lakh of SIP accounts every month. The monthly SIP amount has also increased from 6,222 crore to 7,985 crore at the end of November 2018. The overall folios of mutual funds have also grown by 1.25 crore to 6.7 crore.
One of the key factors on which the growth momentum of mutual fund industry hinges is the investing experience of the investors. If the experience is good, we will witness accelerated inflows; however, a bad experience will ruin this growth. The MF industry had gone through a rough phase during 2009-13 due to bad experience of the investors.
How you select MF schemes?
Therefore, selecting the right mutual fund scheme becomes crucial. Most of us do not follow a disciplined way of selecting a mutual fund. We normally invest based on gossip or rumour. Sometimes, a recommendation from our friend, or worst, trying to mimicking your friend’s portfolio is another common method of investing in MFs. The most prevalent method being investing in top rated funds. All the above ways of selecting funds might or might not work for you. However, you should understand the way MFs work that will help you to select the right funds that are suitable for you.
How Funds are rated
This story is from the January 21, 2019 edition of Dalal Street Investment Journal.
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 January 21, 2019 edition of Dalal Street Investment Journal.
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
