By Matters India Reporter
Patna: India has been witnessing a “great shift” in household savings from physical to financial assets, says a senior executive at a leading mutual fund investment company.
The tendency to funnel savings into physical or non-financial assets—gold and real estate—was changing and an “increasing preference” for mutual funds as means of investment is seen pan-India, says Pradeep Kumar, joint assistant vice president of HDFC (Housing Development Finance Corporation).
Kumar was addressing a November 1 webinar on ‘Opportunities in Mutual Funds Market,’ organized by the department of commerce, St Xavier’s College of Management and Technology in Patna.
Kumar said the first mutual fund was launched in India in 1963 when the Unit Trust of India started its flagship US-64 scheme. By the end of 2019, the country has 44 mutual fund players. “From an investment of 24 lakh crore 24 trillion) rupees in 2003, we can hope to see the mutual fund asset grow to 100 lakh crore (100 trillion) rupees,” he added.
Explaining why one should invest in mutual fund products, Kumar said mutual fund companies pooled money from many investors and invest it in securities such as stocks, bonds, and short-term debt.
“The money invested in mutual funds is professionally managed and well-regulated by SEBI (Securities and Exchange Board of India). The transparency level in such investments is also high. The mutual funds are convenient as one can invest a small amount and the liquidity risk is also low. Risk diversification is the biggest benefit of such funds,” he added.
College principal Jesuit Father T Nishaant congratulated the commerce department for organizing the webinar on a topic which was relevant for a common man and help individuals plan their personal finance objectives.