Mutual Funds Add 5.6 Lakh New Accounts / Portfolio in July 2020

 The Mutual Fund Industry added over 5.6 Lakh investor accounts in July 2020 taking the total tally to 9.2 Crores.. Mostly on account of contribution from debt schemes in comparison the Mutual Fund industry has added 5 Lakh new folios in June 2020.

According to the data released form AMFI ( Association to Mutual Funds in India ), the number of folios with 45 fund houses rose to 9,21,05,737 at the end of last month from 9,15,42,092 at June end registering a gain of 5.63 Lakhs folio last month of which more than 4.5 Lakhs were added in debt funds.

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Our Analysis

The high growth in folio or number of accounts , should not be seen as new fresh investors have joined its only the existing ones who invest through brokers in regular Mutual Funds inspite of having their existing folio in a Fund House for brokerage purpose the advisors / agents put in their own code resulting in generation of new folio of the same investors.

The real data would be to give the number of new additions based on the PAN Number ( Permanent Account Number ) of a person we may see the figure as stated above fall down to One Lakh only.

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What is fund of fund in Mutual Fund ?

Today we will explain what is fund of fund in Mutual Fund parlance. Many a times your would have come to notice this term and you may be inquisitive to know the meaning of the same.

A Fund-of-Fund is basically a Mutual Fund that invests in other mutual fund schemes or ETF ( Exchange Traded Funds ).

So Meaning of Fund of Fund in simple language is " A Mutual Fund investing in series of other existing Mutual Funds ".

Here in our country FOF short form of Fund of Fund are used to invest in ETFs including those that invest in Gold and Equity indices.

Also there are funds of funds which that invest in units of international funds which in turn invest in units of global funds.

Total expenses is capped to 2% by SEBI ( Securities and Exchange Board of India ) a statutory body which monitors capital market and mutual funds in India.

Important Financial News for week 19 to 26 April 2020

• Franklin Templeton India has informed that they have shut down 6 of their debt funds , and amount will be paid to investors in phased manner as and when money is received from from the securities maturing on their due dates.
• Banks have parked more than 7 Trillion Rupees with the Central Bank i.e., Reserve Bank of India which is highest in recent times , as they are afraid of lending the bulk amount to NBFC fearing repayment delays.
• PhonepPe has informed that they are eyeing to become profitable by 2022.
• Mid sized Indian it firm Mindtree has declared their q 4 results which are better than the market expectations and their q 4 profit now stands at 206 Cores.
• Third largest public sector lender after State Bank of India and Punjab National Bank , Bank of Baroda has announced that they are planning to raise Rs 13, 500 Crores over a period of 1 years through mix of both debt and equity and also planning to sell shares to their staff under employee stock options schemes at a discount.
• Tata Steel to raise Rs 5,000 Crores via NCD and that too through private placements hence retail investors will not be getting chance to subscribe the same.
• Due to slump in demand India's number one food delivery mobile app Swiggy has informed that they shall be laying off 500 cloud kitchen staff.