are fast shedding their risk aversion and households are
changing the way they invest. CNBC-TV18 reports that while
rising interest rates have meant a higher inflow into
bank deposits last year, mutual funds are fast scoring
over traditional government sponsored investment schemes.
investors who are known to prefer safe and secure investments
are gradually developing risk appetite. According to the
latest Reserve Bank of India's annual report, the share
of mutual funds in household savings has shot up close
to 4 per cent from less than 0.5 per cent a year ago.
deposits also continue to rise on the back of rising interest
rates to now command a share of 46 per cent as against
36 per cent the previous year. Share of insurance too
has come down from over 15 per cent to a little over 13
per cent now.
sharp contrast, the share of small saving schemes of the
government has fallen to 12 per cent as against 20 per
cent the previous year. Contribution to pension and provident
funds is also going down, from 13-10 per cent.
to the RBI annual report, net household investments in
mutual funds stood at Rs1,500 crore in 2004-05 and jumped
to Rs21,000 crore in 2005-06. Bank deposits meanwhile
was up 72 per cent from the previous year.
investments in small saving instruments are down Rs13,000
crore to Rs72,000 crore.
year has seen huge inflows into mutual funds and expert
says Indians are fast reeling a bit of risk may not be
such a bad idea after all.