Mutual Fund Investment: In India, the number of retail investors has increased fourfold in the last few years. A study conducted by Zerodha Fund House has revealed that there has been a tremendous increase in index mutual funds from March 2020 to March 2024 and it has increased 12 times to 207 in four years. Earlier its number was 44. Along with this, the number of retail folios in index funds increased to 59.37 lakh in December 2023. At the same time, its number was 4.95 lakh in March 2020.
According to the report of Zerodha, the dominance of asset under management (AUM) of index funds has also increased in Nifty 50. The AUM of these funds was Rs 8000 crore in March 2020, which has increased 25 times to Rs 2,13,500 crore in March 2024.
Debt index funds rise
The AUM of debt index funds has seen tremendous growth in the last few years. The AUM was zero in March 2021, which has increased to Rs 1.1 lakh crore in March 2024. In this, the total share of debt index funds is 51.5 percent and the share of equity funds is around 48.5 percent. In view of the increasing demand among investors for index funds, many mutual funds have launched various types of equity and debt index funds in the last four years. By March 2021, their number was 44, which has increased to 207 in March 2024. In such a situation, a total increase of 370 percent has been registered in it.
Giving information about this report, Zerodha Fund House CEO Vishal Jain said that a large number of people investing in mutual funds are index funds. In the last financial year, 11 percent of the newly added portfolios are from index funds. Along with this, he also said that today’s retail investors prefer to invest in easier funds. In such a situation, index funds have become their preferred option.
Index funds are gaining dominance in the Nifty 50 index
This study also revealed that the dominance of index funds has increased in the Nifty 50 index and it has a share of Rs 52,000 crore i.e. 70.7 percent in the assets under management of total equity index funds. After this, Nifty Next 50 comes second with an AUM of Rs 10,000 crore. Apart from this, Zerodha also has two index funds named Nifty Large Midcap 250 Index Fund and LSS Tax Saver Nifty Large Midcap 250 Funds.
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