Retail investors accounted for the bulk of mutual fund accounts in India as of December 2022. They accounted for 128,576,242 or 91.1 per cent of the total 141,119,590 mutual fund accounts, according to data released by the Association of Mutual Funds of India (Amfi).
High net-worth individuals (HNIs) and institutional investors accounted for 11,582,824 and 960,524 mutual fund accounts, respectively.
Overall, there was a 17 per cent increase in the number of mutual fund accounts as against the previous year ending December 2021. The number of accounts in the mutual fund industry as of December 2021 was logged at 120,206,576, the report by Amfi revealed.
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Amfi further said that the account referred to a folio. An investor might have multiple accounts in a single fund or across funds. This was, therefore, not a count of number of investors, but rather the number of accounts.
EQUITY RULES
Equity-oriented schemes remained the top-draw for investors. They accounted for 67.5 of all mutual fund accounts. In second place were exchange-traded funds (ETFs) and/or fund of funds (FoF) at 12.5 per cent, and hybrid funds at 8.5 per cent.
In fact, in December 2022, ETFs and FoFs had crossed hybrid and debt-oriented funds to become the second largest category in terms of accounts, the report said.
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Others were liquid/money market at 2.2 per cent, debt-oriented funds at 3 per cent, index fund at 2.3 per cent and solution-oriented fund at 4 per cent.
Debt-oriented schemes also included gilt funds, the report said.
INVESTING PATTERN
The report also threw some important insights into the investing pattern and behaviour of retail and HNI account holders.
Retail investors concentrated the maximum in solution-oriented schemes (98.2 per cent), ETFs/FoF (97.7 per cent), equity-oriented schemes (92.8 per cent), and index funds (92.1 per cent).
They also held significant accounts in liquid/money market (76.7 per cent), and hybrid schemes (76.5 per cent), and the least number of accounts in debt-oriented schemes (67 per cent).
In contrast, HNI investors predominantly concentrated in debt-oriented schemes (30.7 per cent), hybrid (22.6 per cent), and liquid/money market (20.7 per cent).
According to the report, retail investors held 57.2 per cent of equity assets for period greater than 24 months. Equity assets had a longer average holding period as compared to non-equity assets. As much as 44.4 per cent of equity assets had been held for periods greater than 24 months, the report said.
According to the report, for short-duration, i.e., less than 1 month, 1-3 months, and 3-6 months, non-equity assets have a longer holding period at 18.9 per cent, 11.6 per cent and 10.5 per cent, respectively against 2.9 per cent, 5.4 per cent and 6.1 per cent, respectively, for the same duration for equity.
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For periods above 6 months, equities have a longer average holding period, according to the report.
TICKET SIZE
The average ticket size for equity-oriented funds was Rs. 1.60 lakh. The average ticket size for debt oriented funds was Rs. 13.92 lakh.
The average ticket size for index funds, ETFs/FoFs, hybrid, liquid/money market and solution-oriented were Rs 4.01 lakh, Rs. 3.05 lakh, Rs. 4.10 lakh, Rs. 21.81 lakh and Rs. 57,013, respectively.
Retail investors had an average ticket size of Rs. 70,775 per account. The corresponding figure for HNIs was Rs 8.75 lakh. Institutional investors had the highest average ticket size at Rs 11.59 crore, the report further said.
