MF Update: Equity is preferable asset choice for investors from B30 cities

There is a clear divide when it comes to choice of assets between investors from T30 (T30 refers to the top 30 geographical locations in India) and B30 (B30 refers to the locations beyond the top 30 locations). At the end of November 2018, 64 per cent of the assets from B30 locations are in equity schemes. This has remained the same as it was in the last month (October 2018). In the case of T30 location, equity-oriented schemes accounted for 37 per cent of assets compared to 38 per cent in the month of October.


 
The share of non-equity oriented schemes is higher in case of T30 cities because of the presence of institutional investors in T30 cities, who invest majorly in debt instruments as part of their treasury operations. Institutional assets are concentrated in T30 locations, accounting for 93 per cent of the total. At the end of November 2018, 22 per cent of assets were held by individual investors from the B30 locations, while only 6.5 per cent of institutional assets come from B30 locations.
In terms of total assets of the domestic mutual fund industry, T30 locations still account for almost 85 per cent of assets while B30 account for only 15 per cent. Nonetheless, the share of assets from the B30 per cent cities is increasing at a steady rate. Assets from B30 cities outpaced the growth from T30 cities. On a monthly basis, the assets from B30 grew by 4.1 per cent while from T30 grew at 1.5 per cent.