Retail investors maintain edge over institutional investors

Retail investors continue to invest more in MF schemes compared to their institutional counterpart. One year ago at the end of September 2017, retail investors held 48.5 per cent of the total domestic asset under management (AUM). Nonetheless, the latest figure published by Association of Mutual Funds in India (AMFI) for the period ending September 2018 shows that retail investors held 53.3 per cent of the total AUM. Therefore in the last one year, their share increased by 480 basis points. The share of institutional investors is down by the same proportion. Institutional investors include domestic and foreign institutions and banks. In the institutional investor segment, corporates account for 91 per cent of the total investment rest, which is shared by Indian and foreign institutions.

Retail Investors are equity-dedicated
On analysis of the investment pattern of retail investors, we observe that retail investors invest more in equity-oriented schemes including balanced schemes. Equity-oriented schemes derive 87 per cent of their assets from individual investors (Retail + HNI). HNIs are investors who invest with a ticket size of Rs. 5 lakhs or above. Institutional investors dominate liquid and money market schemes (87%), debt-oriented schemes (56%) and ETF’s, FOFs (93%). In fixed income securities, institutional investors hold the forte.

At the end of September 2018, 68 per cent of individual investor assets were held in equity-oriented schemes. While 80 per cent of institutions assets were held in liquid / money market schemes and debt-oriented schemes.

AUM under the retail category increased by 25 per cent
The value of assets held by individual investors in mutual funds has increased by almost 25 per cent on yearly basis. It increased from Rs.10.40 lakh crore in September 2017 to Rs.12.97 lakh crore in September 2018, an absolute increase of 24.75 per cent. In the same period, the value of institutional assets increased from Rs. 11.05 lakh crore to Rs. 11.34 lakh crore, an absolute growth of 2.64 per cent.