The retail participation in mutual funds has been quite low in India for a number of reasons. Most baffling is the fact that despite being an ideal investment vehicle for investors with varying risk profile and needs, mutual funds have not been able to find a permanent place in their investment universe. How else can one explain the fact that equity funds only have around 3 crore folios? Considering that most investors would have multiple folios across the industry, the number of investors could be just around 5-6 million. In fact, even for a category like liquid funds, which can be an ideal substitute to savings bank account, the retail participation is dismally low.
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