Mutual Funds: Over 66 Lakh New Investors Added In The Last Six Months, Investments Reach $12 Billion

Showing a growing traction for mutual funds among investors, the number of folios has grown by over 66 lakh in the first six months of the current fiscal on account of strong participation from retail investors. During the same period, investment in domestic equities touched a staggering $12 billion on strong retail investor interest, even as foreign investors trimmed their exposure, reports The Hindu.

According to data from the Securities and Exchange Board of India (Sebi) on total investor accounts with 42 active fund houses, the number of folios rose to a record 62,049,189 at the end of September, from 55,399,631 in March-end, a gain of 6.65 million or 66.5 lakh.

Data shows that fund managers bought shares worth a net Rs 76,906 crore ($12 billion) in the first half of the ongoing financial year, while foreign portfolio investors (FPIs) pumped in around Rs 5,278 crore (USD 810 million) in equities during the same period. Folios are numbers designated to individual investor accounts, though one investor can have multiple accounts.

Fund managers made intensive buying in last two months (August and September), when overseas investors reduced their exposure to the Indian stocks for several reasons including geopolitical tensions and domestic growth below expectations.

The sell-off by overseas investors in the Indian equity markets has meant an opportunity to fund managers.

"The rise in number of folios has mainly come from the retail category, which can be seen by growth in folios in equity, balanced and debt segments," BNP Paribas Mutual Fund Chief Investment Officer Ritesh Jain said.

"Besides, low interest has been attracting investors into mutual funds," said Vidya Bala, head of mutual fund research at FundsIndia.com.

Participation in MFs from retail investors, especially from small towns, has been growing.

With inputs from PTI.