Riding the Wave: Exploring the Surge in Equity Mutual Funds
Introduction: The profits collected in the previous few years have made equity mutual funds more appealing. Mutual fund investors are flooding the market. When examining the rise in mutual fund folios during the previous year, the magnitude of the growth in new investments becomes apparent. In the fiscal year 2017–18, mutual funds added 1.6 crore investor accounts, bringing the total to over 7 crores. This is a significant increase from the folio additions of 59 lakhs in FY2015-16 and over 67 lakhs in FY2016-17. During FY2017–18, retail investor accounts increased by nearly 1.5 crore, reaching 5.94 crore. New and inexperienced investors are adding to the pool of retail investors who already invest in mutual funds. Are the influxes of new investors familiar with market volatility? Or will we observe money leaving the market as soon as it has a correction? In the face of volatility, ordinary investors may withdraw money if left to their behavioural biases. Avoid being seduced by the pe