Being a mutual fund distributor is a good career option, says Zerodha's Nithin Kamath
mutual fund industry, Zerodha Founder and CEO Nithin Kamath said as he lamented inadequate number of Registered Investment Advisors (RIAs) and Mutual Fund Distributors (MFDs). While Zerodha offers direct plans, the entrepreneur acknowledged the role of MFDs in taking the industry forward and went on to recommend it as a «good career option».
«Despite all the interest in the stock market after COVID, there are still only 5 crore unique mutual fund investors. I've said this earlier as well—one of the biggest challenges for the Indian markets is the lack of an advisory ecosystem with just about 900 RIAs,» Kamath tweeted.
He also drew comparisons between MFDs and insurance agents with the latter being nearly 10x the former.
«If you consider mutual fund distributors, there are about 2.7 lakh+ plus, but still not enough. For a broad comparison, there are over 27 lakh+ insurance agents. If Indian markets have to expand, not only do we need RIAs but MFDs as well. Moreover, it's tricky to make the RIA model work in smaller cities and towns. Even though we only offer direct plans at Zerodha, we know that they are not for everyone. Which means distributors will always have a role to play. Being a mutual fund distributor is also a good career option for a lot of people,» the tweet said further.
Investors taking exposure to equities via SIPs is a growing trend in India. The monthly mutual fund SIP crossed the Rs 25,000 crore mark for the second consecutive month, standing at Rs 25,320 crore in November, compared to Rs 25,323
