Authored By: Sarah
11 Jul 2024

 Mutual Funds Market Size to grow by USD 71.62 tn between 2023-2027

According to a research report “ Mutual Funds Market” by Type (Stock funds, Bond funds, Money market funds, Hybrid funds) Distribution Channel (Advice channel, Retirement plan channel, Institutional channel, Direct channel, Supermarket channel) Geography (North America, Europe, APAC, South America, Middle East and Africa)- Global Forecast to 2027 published by Technavio, the market size is estimated to grow by USD 71.62 tn, at a CAGR of  9.76% during the forecast period. In the financial market, mutual funds are recognized for their high liquidity, which refers to the ability to buy or sell an asset promptly and without materially impacting its value. This liquidity is derived from the investment composition and substantial trading volume in mutual funds. Mutual funds primarily invest in various market capitalizations, with large-cap stocks offering the highest liquidity. Additionally, investors can select from a diverse range of assets within mutual funds, including equities and fixed income, which are renowned for their liquidity. The benefits of mutual fund liquidity include the ease of fund switching and the flexibility to withdraw during market volatility.

Browse market data tables, figures, and in-depth TOC on “Mutual Funds Market” by Type (Stock funds, Bond funds, Money market funds, Hybrid funds) Distribution Channel (Advice channel, Retirement plan channel, Institutional channel, Direct channel, Supermarket channel) Geography (North America, Europe, APAC, South America, Middle East and Africa) Global Forecast to 2027. Download Free Sample

 

By Type, the Stock funds segment is projected to dominate the market size in 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.

By Distribution Channel, Advice channel  segment is expected to hold the largest market size for the year 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.

North America is forecasted to hold the largest market size by region 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.

The Mutual Funds Market growth and forecasting report also includes detailed analyses of the competitive landscape of the market growth and forecasting and information about 20 market companies, including:

  • Aditya Birla Management Corp. Pvt. Ltd.
  • Amundi Austria GmbH
  • Baroda BNP Paribas Asset Management India Pvt. Ltd.
  • BlackRock Inc.
  • BNY Mellon Securities Corp.
  • Canara Robeco Asset Management Co.
  • DSP Investment Managers Pvt. Ltd.
  • Edelweiss Asset Management Ltd.
  • FMR LLC
  • Franklin Templeton
  • HDFC Ltd.
  • ICICI Prudential Asset Management Co. Ltd.
  • IDFC Mutual Fund
  • JPMorgan Chase and Co.
  • State Street Global Advisors
  • The Capital Group Companies Inc.
  • The Charles Schwab Corp.
  • The Vanguard Group Inc.
  • Axis Asset Management Co. Ltd.
  • PIMCO
.

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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

The mutual fund market has witnessed significant growth in recent years, driven by various digitalized technologies such as e-commerce distribution, e-wallets, and tie-ups with authorities in developing economies. Domestic savings have seen a surge with the convenience of investing in mutual funds through digital platforms. Big Data, cloud computing, blockchain, artificial intelligence, and robo advisors are transforming the industry by providing fair pricing, personalized investment plans, and portfolio management services. Mutual fund providers offer a range of investment options including equity funds, bond funds, sector funds, commodity funds, index funds, money market funds, hedge funds, and systematic investment plans. Individual investors, small fund savers, and retail investors have benefited from the surge in investment through mutual funds, with a particular focus on income-generating funds such as bond funds and equity-oriented schemes. The capital market environment has been favorable for mutual funds, with institutions, FIIs, banks, and corporates increasingly investing in mutual funds. Digital penetration in small towns and the availability of SIP accounts, NSDL accounts, Demat CDSL, and Sensex index have made mutual fund investing accessible to a wider audience. The mutual fund industry is also seeing the emergence of impact funds, negative screening funds, and ESG integration funds in the sustainable strategy segment. Sales charges and expense ratios continue to be important considerations for investors, with a growing emphasis on transparency and disclosure. Liquidity and investors' income-generating needs have led to an increased focus on bond funds and stocks, with insurance companies, FIIs, and banks emerging as significant players in the mutual fund market. ETFs and equity-oriented schemes have also gained popularity among investors. In conclusion, the mutual fund industry is undergoing a digital transformation, with a focus on convenience, fair pricing, and personalized investment plans. The use of digital technologies such as e-commerce distribution, e-wallets, and robo advisors is driving growth in the market, particularly in developing economies. The industry is expected to continue to evolve, with a growing emphasis on sustainable investing and income-generating funds.

Contacts

Technavio Research
Jesse Maida
Media & Marketing Executive
US: +1 844 364 1100
UK: +44 203 893 3200
Email: media@technavio.com
Website: www.technavio.com/

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