Women Investors: Ms Patience scores big with long play on mutual funds

According to a joint study by Crisil and mutual fund trade body AMFI, total assets under management (AUM) of women investors in mutual funds with a holding period of over five years have grown from 8.8% in March 2019 to 21.3% in March 2024. In the case of male investors, it is 19.9% in 2024 as against 8.2 % in 2019.

In the same period, the number of women investors holding their mutual fund investments for less than a year fell from 40.5% to 25.4%. In the case of male investors, it stood at 27% as against 42.1%. This shows the preference of women to hold their investments for a longer tenure compared to men.

“Women investors are increasingly demonstrating patience and discipline in wealth creation,” says Navneet Munot, chairman, Association of Mutual Funds of India.

Investment advisors said women are able to hold investments for longer periods as they do not keep track of short-term moves in equities.

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“Women don’t monitor day-to-day movements in the stock market. This increases the stickiness of investments,” said Kavitha Menon, founder Probitus Wealth, a Sebi registered investment advisor.Overall individual gross flows have risen from ₹7.30 lakh crore in March 2019 to ₹10.13 lakh crore in March 2024, an absolute growth of 38.8%.Of this, gross flows from women rose from ₹2 lakh crore to ₹3.13 lakh crore during the same period, showing a 56.5% growth in absolute terms while gross flows from men investors grew by 41.7%, according to the study. This has helped the assets under management (AUM) of women investors in the industry more than double to ₹11.25 lakh crore in the five years ended March 2024, with one in every four individual investors being women.

The report points out that there is a 24% growth in average folio size of women versus 6% for men between March 2019 and March 2024.

“More women are joining the workforce, saving money and subsequently investing it,” DP Singh, deputy managing director at SBI Mutual Fund. “We are also seeing many businessmen investing in the names of their female family members, thereby leading to a growth in women investing.”

According to the Periodic Labour Force Survey (PLFS) of June 2024, the participation of women in the labour force jumped from 23.3% in 2017-18 (July to June) to 41.7% in 2023-24 (July to June). Notably, the participation of rural women grew at a faster pace from 24.6% to 47.6%.

“There is a growing realization that women tend to outlive men, which is encouraging them to save for the future,” said Swarup Mohanty, Vice Chairman, Mirae Asset Mutual Fund.