ETFs constitute 13% of the total mutual fund industry AUM: Zerodha Fund House
ETFs now constitute close to 13% of the total Mutual Fund Industry AUM indicating the remarkable adoption of ETFs by retail investors in India, according to a study by Zerodha Fund House.
The study reveals that the substantial share of Rs 6.95 lakh crore out of the total Rs 53.40 lakh crore signifies a shift towards more investors choosing ETFs as a preferred mode of investment.
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View Details» <div data-placement=«Mid Article Thumbnails» data-target_type=«mix» data-mode=«thumbnails-mid» style=«min-height:400px; margin-bottom:12px;» class=«wdt-taboola» id=«taboola-mid-article-thumbnails-111233227»>The rise from 5.33 lakh accounts (across equity and debt EFTs) in 2017 to 1.25 crore in 2023 reflects a broader acceptance and understanding of ETFs among retail investors. The increase in the number of ETF accounts, particularly among retail investors, suggests a democratization of investment opportunities. This trend could be attributed to the benefits of ETFs, such as lower costs, diversification, and ease of trading.
The trading volume of ETFs has shown consistent growth, indicating enhanced liquidity and investor participation in the ETF market. The trading volume has surged from Rs 26,139 crore in FY 2016-17 to Rs 1,83,676 crore in FY 2023-24. This increase of over 600% reflects growing investor confidence and the maturation of the ETF market in India. In the last one year, the trading volume of ETFs has seen a significant growth of approximately 64,000 crores.
The study reveals that the ETFs on top three broad indices i.e., Nifty 50 ETF, Nifty Next 50 ETF and Nifty Midcap 150 ETF, alone contribute more than 99% of total AUM
