New Delhi. The number of people investing in mutual funds is increasing continuously. The industry has added more than 81 lakh investors in the first two months of the current financial year 2024-25. This clearly shows that investors' confidence in mutual funds has increased significantly. The fear that people had earlier in their minds about mutual funds has also reduced.

According to the latest data from the Association of Mutual Funds in India (AMFI), there were 17.78 crore registered mutual fund folios at the end of March. Their number reached 18.6 crore at the end of May, that is, more than 81 lakh new folios were added. Folio means the mutual fund account of the investor. An investor can have multiple

Why are mutual fund investors increasing

There are many reasons for the increase in the number of mutual fund investors. Fund houses have increased their focus on marketing. Mutual funds are being promoted by many celebrities. This has increased people's trust in mutual funds. Especially those who were afraid of the risks associated with it till now.

Trivesh D, COO of stock trading platform Tradejini, told news agency PTI that people's perception about fixed deposits (FDs) is also changing. Now FDs do not even give competitive returns compared to mutual funds. Also, investing in mutual funds has become much easier due to digitalization.

Will the uptrend in mutual funds continue?
Experts believe that the number of people investing in mutual funds will continue to grow in the future. Especially, due to the current boom in the stock market and strong marketing. Now mutual funds are also doing better risk management. Their focus has also increased on making investors aware. All this will have a positive impact on the mutual fund market.

Now people's per capita income is increasing. In such a situation, people are looking for long term investment schemes for their savings, which will beat inflation as well as increase their capital. Now since fixed deposits do not give much interest, people are looking for other alternative ways. The best option for them at present is mutual funds, which have good profit potential in the long term.

Most of the investors are from youth

The surge in mutual fund folios in the last few years has been driven by Zen-Y and Zen-Z investors. Zen-Y is also commonly referred to as millennials. This category generally includes people born between 1981 and 1996. Generation Z or GenZ are those born between 1997 and 2012. Most new investors are opting for digital channels to enter the mutual fund segment.

Overall, the total number of investors with unique PAN and PAN-exempt KYC stood at 4.59 crore as of May 2024. Some mutual funds have outperformed market indices, attracting investors looking for higher returns.