Nearly 85 Lakh Millennials Started Investing In Mutual Funds In Last Five Years, Reveals Report
In what can be seen as a big indication of how India's youth is increasingly adopting mutual funds as their investment avenue, a recently revealed report shows that 54% of first-time mutual funds (MF) investors over the last five years have been millennials.
This is one of the many findings from a recent report by CAMS (Computer Age Management Services), which is India’s largest registrar and transfer agent for mutual funds.
Nearly 85 Lakh Millennials Started Investing In MFs
Going by the report, 54% of the 1.6 crore new investors, i.e. about 85 lakh that started investing in MFs during FY19-23 were millennials. The millennials who stayed invested through this entire period had assets worth Rs 96,000 crore as of March 2023.
The report, ‘The emerging force of the millennial investor is here to stay & grow’ was released by CAMS at the 17th CII Mutual Fund Summit held last week in Mumbai. All insights in the report are based on data from the MFs serviced by CAMS. These account for 69% of the Indian MF industry.
The report focuses on millennials who entered the MF space for the first time during FY19-23. As per the report, those born between 1981 and 1996 are millennials.
Interesting Insights From The Report
The report focuses on the new millennials who have entered the mutual funds industry in the last five years (FY 2019-FY 2023). It includes actionable insights for asset managers, intermediaries, advisors and service partners, covering several key areas. These insights emerge from (the millennials’) demographics, preferences in investing, SIP trends, preference for intermediation and advisory services, diversification and stamina to stay invested.
According to the report, millennials have been the dominant segment among new investors who entered mutual funds in the last five years. Key highlights of the report, include:
-1.57 Crore new investors during the five-year period FY19-FY23 entered CAMS serviced Funds. Of these 1.57 crore, 84.8 lakh were millennials with 54% share. Of these 84.8 lakh, nearly 26% were women.
-85% of the new millennial entrants came from urban locations – T 30 locations. This segment has cumulatively added 1.54 crore SIPs during the five-year period.
-A sizeable number (33 lakh) have also diversified across fund houses over the five years, i,e, having invested in more than one fund house.
-Digital and straight-through investment via electronic platforms is significant at 75%.
-Gross inflows from millennials across the five years were over Rs 1,00,000 crore, of which over Rs 65,000 crore was into equity schemes (Growth & Equity Oriented Schemes & Hybrid schemes)
-The AUM (assets under management) of the millennials who stayed through the five years stands at Rs.96,000 Crore as of March 2023.
What Factors Drove Millennials Towards Mutual Funds?
Also Read: Debunking Mutual Fund Myths
Speaking about the report, Mr Anuj Kumar, Managing Director, CAMS Limited said "The addition of millennials who formed 54% of the new investor base into mutual funds has been possible on the back of five key drivers- massive awareness campaigns, conducive market conditions, digital access, simplified KYC and concerted intermediation and advisory. AMCs, Intermediaries, Advisors and CAMS have the responsibility to give these investors a superior experience as they traverse the journey."
“The India story is the envy of the world, a country with the largest population of employed youth. The digital native millennial generation is a massive opportunity to make Mutual Funds the first choice and the most inclusive investment class. The report highlights millennials’ participation in mutual funds and the opportunity the segment holds. We are delighted to release this insightful report that puts the spotlight on the new millennials who are a dominant section choosing MFs as their choice of investment for wealth creation."
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