From Savers To Investors

At 21 per cent, India’s household savings rate is one of the highest in the world. While in the past, a significant portion of this money was channelled into non-financial assets, such as real estate and gold, now, 49 per cent of this household savings are being invested in financial assets. More importantly, households are showing increasing appetite for stock markets. This is reflected in the rising share of equity in households’ total financial assets, though the overall share remains significantly small. Last year, due to market volatility, most asset classes generated below average returns. The mutual fund industry waited with baited breath to see how investors, who chose to invest through SIPs, would react. A huge cheer went across the mutual fund industry when the January AMFI data came across, as we tipped past the Rs8000 crore per month in the SIP book. The data...