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Mutual Funds Assets growth
Why is it in the news?
- It is recorded in the recently ended financial year(2018-19) that the mutual fund assets growing at the slowest pace in seven years.
- The reason for the slowest growth is been cited as the huge outflows of the debt funds.
- The debt funds constitute a major portion of the overall assets under management (AUM) of the industry.
More in the news
- As per the Cricil analysis, the total AUM rose 6% to touch ₹24.51 lakh crore in the fiscal, even as debt funds saw total outflows of ₹1.38 lakh crore between April 2018 and February 2019.
- Assets under management (AUM) are the overall market value of assets/capital that a mutual fund holds.
- The fund manager manages these assets and takes investment decisions on behalf of investors.
- AUM is an indicator of the size and success of a fund house.
- Debt funds, which account for nearly 45% of the total assets, managed to recoup some of the losses of the previous quarter, and were up 2.3% or ₹24,500 crore, to ₹11.08 lakh crore in the March quarter.
- Also, the assets of low duration, medium duration, credit risk, short duration and floater funds fell the most in absolute terms among the debt categories.
- Mutual Funds:(1) A mutual fund is an investment vehicle made up of a pool of moneys collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and other assets.(2) Mutual funds are operated by professional money managers, who allocate the fund's investments and attempt to produce capital gains and/orincome for the fund's investors.
Source
The Hindu.