Average ticket size of retail investors down 23% to Rs 59,201 in 2019

The popularity of the mutual fund as an investment vehicle may have increased among the retail investors but the average ticket size is indicating a falling trend.

According to the data by the Association of Mutual Funds in India, the average ticket size of retail investors fell 23 percent to Rs 59,201 until September 2019. In comparison, the average ticket size for retail investors stood at Rs 77,318 in 2018.

Mutual fund experts attributed the drop to the entry of new investors.

“The average ticket size (of retail investors) has gone down due to the entry of new investors. Also, retail investors are choosing more schemes to diversify their portfolio,” said Hiren Dharamshi, Managing Director, CashRich, which is a wealth management app for investments.

He also added that the AUM of the mutual fund industry has increased compared to last year with individual investors value of assets at Rs 14.09 lakh crore (14 percent up).

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As per AMFI, fund houses added nearly 7,70,000 new folios until September, registering a growth of nearly 10 percent to 8.56 crore from a year ago.

Equity-oriented schemes derive 87 percent of their assets from individual investors, that is, retail investors and high net worth individuals (HNIs).

The average ticket size in the equity scheme is Rs 1.25 lakhs, while retail investors' average account size is Rs 63,701.

The average ticket size dropped not only for retail investors in 2019 but also for HNIs, corporates, and institutions compared to last year.

For HNIs, the average ticket size fell to Rs 8.4 lakh from Rs 15.7 lakh, a drop of 46 percent while that of corporates dwindled by nearly 37 percent to Rs 1.3 crore against over Rs 2 crore in 2018.

Institutions also witnessed its ticket size falling to Rs 8.6 crore from Rs 10.4 crore last year.

In terms of scheme category wise, the liquid/money market fund have the highest average ticket size. Investors hold Rs 22.4 lakh in liquid funds on average.

"The size of liquid fund is large it is mostly the corporates or institutions, which hold liquid AUM," said a mutual fund distributor.