Retail investors stay longer than biggies in equity funds

Business Line Research Bureau Retail investors take a longer-term view of mutual fund schemes than high net worth individuals (HNIs), FIIs, banks or financial institutions, according to the Association of Mutual Funds in India (AMFI).The findings of the first numbers released by the AMFI on holding periods of investors for March indicate that 46 per cent of retail investors – by assets – held their equity funds beyond 24 months; 36.4 per cent of HNIs also had a two-year-plus holding period. However, only about 18 per cent of the banks, financial institutions and FIIs who invested in equity funds held on beyond 24 months.
More HNIs than retail investors held for one to two years. Overall, about 82 per cent of retail assets stayed on for more than a year in equity funds.
The report also indicates that equity funds made up 26 per cent of the total assets managed by the fund industry. Retail investors were the major investors in equity funds, making up 64.8 per cent of equity assets. They accounted for an even higher 68.2 per cent of the balanced funds.
HNIs were the next largest category of investors with a 20.6 per cent share of equity and 22.2 per cent in balanced funds (according to AMFI, HNIs are those who invest more than Rs 5 lakh).
Debt funds, as expected, are dominated by companies, with corporates accounting for 64.7 per cent of debt assets. HNIs were also big debt investors with a 28.6 per cent share.
Retail investors made up only 4 per cent of the asset base of debt funds. According to a report, AMFI is planning to publish this report every six months.

Source: http://www.thehindubusinessline.com/2009/06/25/stories/2009062551921300.htm