Assets Under Management (AUM) of Mutual Funds - Equity

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Source: CMIE Economic Outlook, 1 Finance Research

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What does the Assets Under Management (AUM) of Equity Mutual Funds data represent?

The Assets Under Management (AUM) of Equity Mutual Funds represents the total market value of all the investments held in equity mutual funds.
This encompasses funds invested in stocks and equity-related instruments across various sectors and industries.
The AUM in equity mutual funds is a crucial measure that indicates the scale of investment in the stock market through mutual fund schemes.

AUM in equity is a key indicator of the confidence of domestic investors in the stock market and reflects the popularity and growth of mutual funds as an investment vehicle in the economy.
Changes in equity AUM can indicate shifts in economic sentiment, as investors are likely to invest more in equities in a bullish economic environment.
The growth or decline in equity AUM reflects broader market trends, correlating with stock market performance and changing investor sentiment and confidence in the equity market.

A substantial AUM in equity contributes to the liquidity and depth of the stock market, facilitating price discovery and stability.
A rising AUM in equity mutual funds is often aligned with bullish stock market trends, indicating strong investor confidence in the equity market and optimism about corporate earnings and economic growth, while a decline might correspond with bearish market conditions.
The growth in equity AUM can indicate the risk appetite of investors, reflected through increased participation of retail investors in the stock market, diversifying the investor base.