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Mutual Funds: Megatrend of the decade?
Jan 17, 2020


On Tuesday, Ankit wrote to you about a recent upcoming IPO.

It's a company profiting from two megatrends - digitisation and financialisation - in the Indian economy.

A quick comparison of assets under management (AUM) of mutual funds in India versus abroad will give you a clear idea of the huge megatrend.

India's mutual fund AUM as a percentage of GDP is 11%. This is far lower than the world average of 55%.

I strongly believe, the next decade could be the decade of financialisation in India.

Traditionally, Indian households have preferred to invest in physical assets like real estate but things are changing.

Indians now are more open to investing in financial assets like mutual funds. Better awareness, financial education, increasing urbanisation are all driving this change.

Mutual fund AUM grew 24% annually in the last 5 years. I expect India's GDP to grow at 6-7% over the next decade.

Just combine these growth rates and you can see the massive growth opportunity .

Data Source: CAMS DRHP

This Chart Of The Day was published in The 5 Minute WrapUp - How to Buy the Best Safe Stocks in 2020

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