MF Update: The rise of individual investors

The current bull market that started somewhere in the last quarter of 2013 seems to be more inclusive than any time before. More and more retail investors are participating in this rise. Many investors have skipped the direct route of equity investment and are using equity mutual funds to take equity exposure. Equity-oriented schemes now derive 87 per cent of their assets from individual investors including high net-worth individuals. This increased participation of retail investors has helped increase the overall share of their assets in the domestic mutual fund. The share of individual investors that was below 50 per cent a year ago and went up to 54 per cent at the end of November 2018, according to AMFI data. Their share was 53.3 per cent at the end of October 2018.

The share of individuals grew steadily over the period, baring a few months. The chart below shows how their share has increased.

The value of assets held by individual investors in mutual funds increased from Rs. 11.10 lakh crore in November 2017 to Rs. 12.73 lakh crore in November 2018, an absolute increase of 14.67 per cent. In the same period, the value of institutional assets declined from Rs. 11.63 lakh crore to Rs. 10.86 lakh crore, a decline of 6.58 per cent.