Indian MF Industry : Lost 32 lakh Investors in 10 months..!


The Indian mutual fund  (MF) industry lost more than 32 lakh investors, measured in terms of individual accounts or / folios, in the first ten months of the current financial year - 2012-13..

"The number of folios* , have fallen to 4.32 crore at the end of January, 2013 from 4.64 crore in the previous fiscal (2011-12), translating into a decline of 32.45 lakh new investor accounts," according to the latest data of the Securities and Exchange Board of India (SEBI about total investor accounts with the country's 44 fund houses.

Equity MF schemes were the biggest losers in terms of folios, losing 40.2 lakh new investor accounts. The total number of folios in equity funds plunged to 3.36 crore at the end of January 2013 from 3.76 crore in the previous financial year.

The benchmark BSE Sensex has gained aout 15  in the current financial year so far (April 2012-January 15). According to market participants, investors have used market rally as an opportunity to exit after booking profits.

Equity MF folios form above 70% of the industry's total new investor accounts.

The MF industry has been facing consistent equity MF folio closures in the last few months. Besides, equity MF schemes have seen outflows for the past 8 months, with January (2013) witnessing an outflow of Rs. 2,501 crore.

Mr. Jimmy Patel, CEO, Quantum Asset Management Company said, "The sharp fall in the number of folios can be attributed to profit booking & various merger scheme in the mutual fund industry among others"

Balanced  MF schemes, which invest in equity & debt category, followed closely and shed 1.11 lakh folios to end at 26.07 lakh in January, 2013.

Exchange traded funds (ETFs) gained 1.09 lakh folios to 7.32 lakh investor accounts at the end of January, 2013.

Note: * Folios are numbers designated to individual investor accounts, although one investor can have multiple folios.

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