Mutual Funds Market Size to grow by USD 84 trillion between 2024-2028
The Mutual Funds Market is segmented by Type (Stock funds, Bond funds, Money market funds, and Hybrid funds), Distribution Channel (Advice channel, Retirement plan channel, Institutional channel, Direct channel, and Supermarket channel), and Geography (North America, Europe, APAC, South America, and Middle East and Africa). As per the Global Forecast research report 2024-2028 published by Technavio, the market size is estimated to grow by USD 84 trillion, at a CAGR of 10.43% during the forecast period. There are several companies that are contributing to the market as per this report. Growth of mutual fund assets in developing nations .
By Type, the Stock funds segment is projected to dominate the market size in 2024
In the business world, mutual funds represent a popular investment vehicle for corporations and individuals alike. These financial instruments specialize in the acquisition of corporate stocks, offering a diverse range of options. Among these, growth funds focus on stocks demonstrating high growth potential, often without consistent dividend payments. Conversely, income funds prioritize stocks providing regular dividends. Index funds mirror specific market indices, such as the S&P 500 Index, while sector funds zero in on particular industry sectors. Mutual funds are further classified based on the proportion of assets allocated to equities. For instance, large-cap funds maintain a minimum 80% investment in the stocks of the largest companies, typically the top 100 in market capitalization.
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By Distribution Channel, Advice channel segment is expected to hold the largest market size for the year 2024
In the Mutual Funds Market, financial advisors play a pivotal role by offering expert guidance, support, and counsel to investors. These professionals, including independent financial planners, bank certified sales representatives, full-service brokers, and insurance agents, assist shareholders in defining their financial goals, such as retirement, tax mitigation, education savings, and estate planning. Advisors evaluate clients' risk tolerance levels and recommend suitable mutual funds and other investment products to help achieve these objectives. They serve as intermediaries, executing transactions on behalf of investors while also representing funds to distribute prospectuses, financial reports, and proxy statements. Additionally, they maintain investment records and provide shareholders with periodic financial statements.
Why is North America forecasted to hold the largest regional market size in 2024?
The North American mutual funds market held a significant market share in 2022, driven by persistent trading activities and the substantial presence of the equity market in the United States. With over 40% of the global equity market share as of August 2021, the US offers investors tax efficiency, transparency, and centralized access to stock exchanges. Given the cost-sensitive nature of most investors, the elimination of brokerage commissions through mutual funds has resulted in increased demand. This trend is expected to continue, making mutual funds an attractive investment option in the region.
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Research Analysis Overview
The Mutual Fund industry has witnessed a surge in investment from small fund savers, driven by the increasing popularity of Portfolio Management Services and various Investment Plans. This trend is particularly noticeable among income-seeking investors, who are drawn to the liquidity and diversification benefits of Mutual Funds. Small investors can choose from a range of funds, including Bond Funds, Index Funds, Money Market Funds, Equity Funds, and Hedge Funds. Bonds and Stocks are the two primary securities classes in Mutual Funds, with Bond Funds offering fixed income and lower risk, while Equity Funds provide the potential for higher returns through exposure to the stock market. Insurance Companies, FIIs, and Banks are significant players in the Investment Fund Industry, managing large fund portfolios through Equity strategies. The industry has also seen the emergence of Systematic Investment Plans (SIPs), which allow investors to invest a fixed amount at regular intervals, making investing more accessible and convenient. The digital penetration and the rise of Smart Cities have further boosted the growth of the Mutual Fund industry, enabling investors to manage their funds online and access real-time information about their investments. Overall, Mutual Funds continue to be an attractive investment option for both short-term debt and long-term income generation.
Market Research Overview
According to Technavio's market research, the global mutual funds market is classified under the broader category of the global specialized consumer services market, which encompasses the revenue generated by various consumer service providers. This market segment includes sectors such as residential services, home security services, legal services, personal services, renovation and interior design services, consumer auction services, wedding services, and funeral services. Technavio's analysis calculates the size of the global specialized consumer services market based on the revenue generated by these specialized service providers, including mutual fund companies. - The Mutual Funds Market is experiencing significant growth, fueled by the . Industries are leveraging the products belonging to the market for customer engagement, transactional notifications, and promotional offers.
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