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<\/figure><\/div>\n\n\n\nData as of April 30, 2019 Despite the growth in the AUM within a year, the number of portfolios increased to 7,97,25,429 and the number of investor accounts has shown an upward trend from December 2014. Between March 2014 and March 2019, investor accounts increased from 3.95 crores to 8.25 crore. The industry witnessed a drop in the number of investor accounts in equity investment.<\/p>\n\n\n\n Data as of March 31, 2019 There was a sharp rise in the number of equity accounts in 2016-17, but the growth slowed down in 2018-19. However, the proportionate share of equity-oriented schemes is now 42.4% of the industry assets in April 2019, up from 41.3% in April 2018. <\/p>\n\n\n\n The proportionate share of debt-oriented\nschemes is 29.3% of industry assets in April 2019, down from 34.9% in April\n2018. Even the equity inflows whoopingly\ndropped by 62% to Rs 4,230 crore for\nthe month of April 2019 from Rs 11,171 crore last year.<\/p>\n\n\n\n Graph 4:<\/strong> Equity\ninflow dipped (Rs in Crore)<\/em><\/strong><\/p>\n\n\n\n Data as of April 30, 2019 The\nprobable reasons for such a drop are:<\/p>\n\n\n\n As the election\noutcome draws in closer, the equity market is acting like a seesaw on account\nof speculation. If the Modi-led government comes to power, there would be a\nrally and if not, then the markets would plunge.<\/p>\n\n\n\n Although the quantum of gains\/losses divides the opinions of market\nexperts, nobody seems to be disputing the market’s direction under a scenario.<\/p>\n\n\n\n At present, mutual fund investors are facing a dilemma. The pre-election rally has made many of them believe that they have missed the bus. The uncertainty around who will form the government is keeping them on the fence. While some of the investors are trying to time the market and waiting for the election drama to subside. <\/p>\n\n\n\n But it has been observed that whatever the outcome of the election, its effect wears off in short time. And the focus is on fundamentals and other economic factors.<\/p>\n\n\n\n [Read<\/strong>: How To Place Your Mutual Funds Portfolio Ahead Of Election Results<\/a>]<\/p>\n\n\n\n The US-China trade war gets murkier and could escalate into a global trade war. Even the delay in Brexit and the rising crude prices have a jarring effect on the equity markets. The markets were under pressure. especially the Small-cap indices and mid-cap indices. as compared to the large caps. <\/p>\n\n\n\n Corporate\nearnings haven’t been very encouraging; the Nifty 500 profit-to-GDP ratio is at\na 15-year low. Plus, there are governance issues with a few companies. Earnings\ndid not justify the valuations. The trail P\/E of the S&P BSE Sensex is currently\nat 28x.<\/p>\n\n\n\n The average GDP growth rate over the last four-and-a-half years under Prime Minister Modi’s regime is around 7.3% and the fiscal deficit has widened. Recent CPI numbers show signs of slow momentum. <\/p>\n\n\n\n All this has been weighing down on the investors’ sentiments to invest in equity funds.<\/p>\n\n\n\n SEBI\u2019s regulatory commission norms<\/a> were proposed to streamline the expense ratio and bring in more transparency to the investors to guide them in making better investment decisions. But it has discouraged the advisers by banning the upfront commission, mandated trailing commission model and implementing new total expense ratio slabs.<\/p>\n\n\n\n While many mutual fund houses have yet to come out with the new structure, the advisers are waiting and actively promoting alternate products like the insurance. That\u2019s because the commissions earned on such financial avenues are much higher for distributors. <\/p>\n\n\n\n Instead of advising investors to keep up with their ongoing SIPs<\/a>, now that the market has corrected, several advisers are mis-selling investment products. In other words, they are not placing the investors\u2019 interest at the fore. This could further tamper the growth of the industry. <\/p>\n\n\n\n However, it is interesting that the number of equity folios has been good and there were fewer outflows in this category, which was from Large & Mid Cap Fund and Dividend Yield Fund as seen below:<\/p>\n\n\n\n Table1: Open-ended Equity inflows\/outflows<\/em><\/strong><\/em><\/strong><\/p>\n\n\n\n
(Source: www.amfiindia.com<\/a>)<\/p>\n\n\n\n![\"\"](\"http:\/\/blog.certifiedfinancialguardian.com\/wp-content\/uploads\/2019\/05\/cfg-17-5-2019-graph-2.png\")
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(Source: www.amfiindia.com<\/a>)<\/p>\n\n\n\n![\"\"](\"http:\/\/blog.certifiedfinancialguardian.com\/wp-content\/uploads\/2019\/05\/cfg-17-5-2019-graph-3.png\")
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(Source: www.amfiindia.com<\/a>)<\/p>\n\n\n\n