December 7, 2023


Moving Forward

Passive funds have gained market share from 1.4% of AUM in 2015 to over 17% today: Motilal Oswal Mutual Fund

A review by Motilal Oswal Asset Administration Organization (MOAMC) exposed that passive money have gained marketplace share from 1.4% of AUM in 2015 to about 17% now. MOAMC offers the widest assortment of passive cash in India with far more than Rs 17,000 Crs in AUM throughout 30 Index Funds, ETFs, and FoFs.

The survey carried out with far more than 2,000 buyers collaborating from throughout the state, shares insights on the use and mind-set of investors to passive cash in India. The review also throws light-weight on investors’ desire for SIPs more than lumpsum investing, an affinity for index funds, and reliance on social media over information shops in their investment decision conclusion-producing, the fund household mentioned.

Vital Highlights:
• 61% of respondents say they have invested in at least 1 passive fund
• The top 3 causes for investing in passive money turned out to be small value, simplicity, and sector returns
• 53% of respondents say they elevated their allocation to passive resources in the past 12 months
• 3 in 4 respondents like to make investments working with SIPs, underscoring the relevance of disciplined investing for prosperity creation above the extended-term
• Close to 60% of respondents said that they count on Social Media for information on marketplaces and investments
• A lot more than 80% of respondents say they program to hold their investments for far more than 3 yearsSpeaking on the analyze, Navin Agarwal, MD & CEO, Motilal Oswal Asset Management Corporation, said, “The desire for passive investing has grown exponentially around the past few many years, which displays in AUM advancement of 8.5x in the final 5 many years at a CAGR of 54%. Our commitment to innovation and education will continue on to assist the upcoming of passive cash in India.”Pratik Oswal, Head of Passive Money, Motilal Oswal Asset Management Company, said, “Passive funds are extensively preferred in the U.S. and have over 50% sector share. We have commenced looking at very similar tendencies in India about the last number of years as perfectly. With a market place share of all around 17%, we consider that there is sufficient runway for passive resources ahead. This study is a to start with of its variety in India and presents insights into how investors think about passive funds. It also allows get rid of some mild on the assumed procedure at the rear of investment selections of Indian traders.”

In accordance to the findings of the study, 61% of investors have invested in at minimum a single passive fund. All around 57% of respondents want these cash thanks to their minimal-charge mother nature as the largest cause, adopted by 56% of respondents who truly feel that the simplicity of these funds is what pulls them to make investments in them, and far more than 54% buyers do so for the actuality that they are inclined to deliver market place returns.

At the stop of FY-2018, the AUM of all passive cash place jointly stood at all over Rs 83,000 crore. It has grown to additional than Rs 7,00,000 crore as of Mar-2023, soaring 8.5x in just 5 a long time at a CAGR of 54%.