Mutual Funds Becoming Popular Among Young Investors: R. K. Jha, MD CEO, LIC Mutual Fund Asset Management Company

The vision of LIC Mutual Fund is, ‘To be a trusted partner in wealth creation and a mutual fund of choice’. In accordance, we intend to be a fund house of choice for Investors and help them to create wealth through our prudent Investment philosophy balanced with ethical risk practices. We have a committed team of professionals in both Equity and Debt Fund Management Team highly skilled and well equipped to understand the market dynamics and take the funds through up and down of market volatility.

Mutual Funds are increasingly becoming popular among young investors as a preferred means of investment. Many of them are using Mutual Funds to achieve financial goals such as wealth creation, child’s education, property purchases, and planning for retirement.

To achieve our growth objectives, we have crafted a multi-faceted strategy that includes significant investments in both physical and digital infrastructure. We have increased our physical touchpoints by expanding our branch network and investor service centres. We have also launched mobile application (LICMF Investor App) that allow investors to transact in our schemes from the comfort of their homes. Recognizing the importance of digital megatrend, we have strengthened our presence on social media platforms to connect with young investors. We are also using digital campaigns to raise awareness among investors and help investors to take informed decisions.

New product launches, strengthening our teams across functions and enhanced engagement with investors on a continuous basis, are our key initiatives which in long run will drive growth.

We are a staunch believer in the growing contribution of Bharat (primarily non-urban India) in the current booming Indian economy Reaching out to investors in Tier 2 and Tier 3 towns, beyond the Top 30 (T30) locations, is a priority for us. We have opened new branches in these areas.

We are regularly conducting investor education sessions, along with creating investor awareness campaigns in select regional languages.

Many LIC of Agents , who are also empanelled with us as Mutual Fund Distributors, sell our products. We actively engage with the Distributor Fraternity to keep them informed about our approach and various initiatives we take to enhance our investors’ experience.

We have recently launched our new and upgraded Distributor Portal.

The increasing financialization of savings and the rising preference for digital transactions have contributed to the growth in assets under management (AUM) of mutual funds, especially in passively managed funds like Exchange Traded Funds (ETFs).

Passive Mutual Funds have low operating costs. Index Funds and ETFs are designed to replicate popular market indices. A Fund Manager has a non-active role in selecting stocks to construct the portfolio as they have to simply mirror the chosen index. This simplicity coupled with its ability to easily integrate in the evolving digitization and tech revolution in the industry makes a passive fund a key segment of Mutual Fund Industry. Hence, investors may look at investments both in active in passive space.

Passive strategies Vs Active Investments have been a long-standing debate, ultimately the Investors needs to understand that both the strategies have its Pros and Cons.

LIC Mutual Fund has a presence in Passive space with products both under the Index and ETFs categories.

Planning for retirement is critical for an individual as even after 60-65 years one may have to sustain his own life and ensure liquidity to meet exigencies. It is therefore, important to start early in your working years by saving in vehicles that outpace inflation. With time on your side, you can take some risk by investing in potential high-risk assets such as equities and Mutual Funds.

Always complement statutory retirement savings avenues, such as Life Insurance, Health Insurance, Employees’ Provident Fund (EPF), by investing in the diversified equity schemes in a staggered manner using Systematic Investment Plans (SIP).

Increase your SIP amount regularly to cope up with rising inflation and invest with a long-term view, for Equity portfolios. As retirement approaches, one may move money to less risky avenues such as debt funds.

We have been very careful when launching new fund offers (NFO). We opt to launch NFOs after seeking feedback from our investment management team, investors, market appetite and our distributors. Each new product is designed to address investment needs of our clients. We keep improving our capabilities to serve a larger client base by offering a wider range of products that cater to the specific needs of the investors.