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Mutual Fund Services
Working in association with Various AMC in India, I have been part of a mission to promote and streamline mutual fund investments in the country. It has been immensely rewarding to assist investors in making informed decisions about mutual funds, offering them a diverse range of investment options tailored to their financial goals and risk appetite. I have seen individuals grow their wealth and achieve their dreams through disciplined and strategic mutual fund investments.
Insurance information
In collaboration with the LIC, I have had the privilege of helping individuals secure their future through Life & comprehensive Health insurance solutions. Whether it's life insurance, health insurance, or general insurance, providing advisory services has enabled me to protect people from unforeseen events, giving them peace of mind and financial stability.
Equity Broking Services
In the realm of equity advisory services, I have had the honor of assisting investors in navigating the stock markets under a broking firm membership with the aegis of the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). Witnessing the markets' ebbs and flows, I have employed data-driven analysis and research to guide clients in making well-informed investment decisions. The thrill of witnessing portfolios grows and clients achieving financial success has been truly inspiring.
Which is best Direct (or) Regular in Mutual Funds
It seems direct plan investors could do with a bit of handholding.
The latest AMFI data on longevity of SIP accounts shows that most investors who started SIPs through direct plans discontinue their SIPs within five years.
Of the total SIP AUM of Rs.23,500 crore in direct plans, just 9% or Rs.2,069 crore remain invested for over five years. The rest, 21,500 crore of SIP AUM in direct plans have been redeemed within five years.
However, in terms of no. of folios, 61% or 17 lakh SIP accounts opened through direct plans have been active for over five years. A rough calculation shows that each of these SIP folios has Rs.12,000 as on December 2018.
If we delve deeper into the SIP longevity data, most assets in direct plan SIPs are redeemed within 2 years. While 41% of SIP AUM or Rs.9610 crore was redeemed within a year, the industry saw an outflow of Rs.5900 crore or 25% between 1 and 2 years.
Expert attribute this to lack of patience among direct plan investors. In fact, a Kfintech report which looked at investor behaviour in both stable market and volatile markets found that while direct investments have increased, investors who invested in mutual funds through direct plans redeemed their investment when the markets turned volatile. “Over 80% of the redemptions were carried out with a holding period of less than one year in case of direct investments. This clearly indicates that as soon as markets turned volatile, direct investors decided to move out of mutual funds while distributors, especially IFAs, could convince their investors to stay invested for benefits of long term investments. It is clearly evident that direct investors get worried due to lack of guidance and take a decision to leave the fund as soon as the markets turn choppy. Mutual fund is not a product meant for short term investments,” says the report.
On the contrary, most investors who invested in SIPs through regular plan show sign of maturity. Of the total SIP AUM of Rs.2.17 lakh crore in regular plans, close to 20% or Rs.42,000 stay invested for over five years. In absolute terms, 1.37 crore SIPs or 60% folios remain active for over five years. Each of these SIP folios has roughly over Rs.31,000
Early redemption from SIPs is also prevalent in regular plans too. Close to 31% or Rs.67,000 crore regular plan SIPs AUM redeemed within a year and 22% or Rs. 48,000 crore between 1 and 2 years.
Overall, the industry has seen 18% of SIP AUM remain invested for over 5 years.
Currently, SIP AUM is Rs.2,40,147 crore which is 10.5% of the overall MF Industry AUM. The AMFI data shows that SIPs in regular plans account for 89% of the total SIPs. Of the 2.54 crore SIP folios, distributors have created 89% of SIP accounts i.e. 2.26 crore. In absolute terms, SIP contribution in regular plans account for 88% of the total inflows through SIPs.
It seems direct plan investors could do with a bit of handholding.
The latest AMFI data on longevity of SIP accounts shows that most investors who started SIPs through direct plans discontinue their SIPs within five years.
Of the total SIP AUM of Rs.23,500 crore in direct plans, just 9% or Rs.2,069 crore remain invested for over five years. The rest, 21,500 crore of SIP AUM in direct plans have been redeemed within five years.
However, in terms of no. of folios, 61% or 17 lakh SIP accounts opened through direct plans have been active for over five years. A rough calculation shows that each of these SIP folios has Rs.12,000 as on December 2018.
If we delve deeper into the SIP longevity data, most assets in direct plan SIPs are redeemed within 2 years. While 41% of SIP AUM or Rs.9610 crore was redeemed within a year, the industry saw an outflow of Rs.5900 crore or 25% between 1 and 2 years.
Expert attribute this to lack of patience among direct plan investors. In fact, a Kfintech report which looked at investor behaviour in both stable market and volatile markets found that while direct investments have increased, investors who invested in mutual funds through direct plans redeemed their investment when the markets turned volatile. “Over 80% of the redemptions were carried out with a holding period of less than one year in case of direct investments. This clearly indicates that as soon as markets turned volatile, direct investors decided to move out of mutual funds while distributors, especially IFAs, could convince their investors to stay invested for benefits of long term investments. It is clearly evident that direct investors get worried due to lack of guidance and take a decision to leave the fund as soon as the markets turn choppy. Mutual fund is not a product meant for short term investments,” says the report.
On the contrary, most investors who invested in SIPs through regular plan show sign of maturity. Of the total SIP AUM of Rs.2.17 lakh crore in regular plans, close to 20% or Rs.42,000 stay invested for over five years. In absolute terms, 1.37 crore SIPs or 60% folios remain active for over five years. Each of these SIP folios has roughly over Rs.31,000
Early redemption from SIPs is also prevalent in regular plans too. Close to 31% or Rs.67,000 crore regular plan SIPs AUM redeemed within a year and 22% or Rs. 48,000 crore between 1 and 2 years.
Overall, the industry has seen 18% of SIP AUM remain invested for over 5 years.
Currently, SIP AUM is Rs.2,40,147 crore which is 10.5% of the overall MF Industry AUM. The AMFI data shows that SIPs in regular plans account for 89% of the total SIPs. Of the 2.54 crore SIP folios, distributors have created 89% of SIP accounts i.e. 2.26 crore. In absolute terms, SIP contribution in regular plans account for 88% of the total inflows through SIPs.
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