PUBLISHER: TechSci Research | PRODUCT CODE: 1637254
PUBLISHER: TechSci Research | PRODUCT CODE: 1637254
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Global mutual fund assets market was valued at USD 593.18 Billion in 2024 and is expected to reach USD 880.27 Billion by 2030 with a CAGR of 6.8% during the forecast period.This expansion is driven by factors such as increasing investor awareness, the desire for portfolio diversification, and the accessibility of various investment strategies. Mutual funds offer investors the opportunity to invest in a diversified portfolio of assets, including equities, fixed income securities, and other instruments, managed by professional portfolio managers. The market is characterized by a diverse range of investment strategies, including equity, fixed income, multi-asset/balanced, sustainable, and money market funds, catering to the varied risk profiles and investment objectives of investors. Additionally, the market is segmented by investor type, encompassing both retail and institutional investors, and by distribution channels such as direct sales, financial advisors, broker-dealers, and banks. Geographically, North America has historically dominated the mutual fund assets market, accounting for a significant share of the global AUM. However, regions like Asia Pacific are experiencing rapid growth, driven by emerging markets and increasing financial literacy among investors. As per, AMFI India in 2024, the Indian mutual fund industry has experienced significant growth, with Assets Under Management (AUM) reaching USD 794.37 Billion, marking a more than six-fold increase from USD 127.18 Billion in 2014. The industry has also seen a substantial rise in Systematic Investment Plans (SIPs), with approximately 102.3 million SIP in November 2024. The competitive landscape is marked by the presence of major asset management firms, including BlackRock, Vanguard, and Fidelity, which continue to innovate and expand their offerings to meet the evolving needs of investors.
Market Overview | |
---|---|
Forecast Period | 2026-2030 |
Market Size 2024 | USD 593.18 Billion |
Market Size 2030 | USD 880.27 Billion |
CAGR 2025-2030 | 6.8% |
Fastest Growing Segment | Direct Sales |
Largest Market | North America |
Market Drivers
Economic Growth and Rising Disposable Income
As global economies expand, particularly in emerging markets, there is a corresponding increase in disposable income. This economic uplift enables a larger segment of the population to invest in mutual funds, seeking to grow their wealth and secure financial futures. The growing middle class in regions like Asia Pacific contributes significantly to the expansion of the investor base. Asia's middle class is expanding rapidly, with projections indicating that the number of middle-class households in the region will rise from 354 million in 2024 to 687 million by 2034.
Financial Literacy and Awareness
There is a growing emphasis on financial education, leading to increased awareness about investment opportunities. As individuals become more knowledgeable about the benefits of mutual funds, they are more inclined to invest, recognizing the importance of diversification and professional management in achieving their financial goals. Research conducted by the Research and Information System for Developing Countries (RIS) in 2022 revealed that approximately 68.4% of household investments in India are directed towards mutual funds, with shares in companies accounting for 26.4%. This trend underscores the growing preference for mutual funds as a preferred investment asset among households.
Technological Advancements and Digital Platforms
The rise of digital platforms and fintech solutions has made investing in mutual funds more accessible. Online platforms and mobile applications allow investors to manage their portfolios conveniently, track performance, and make informed decisions, thereby attracting a broader audience to the mutual fund market. In India, the proportion of mutual fund transactions conducted digitally surged from 60% in fiscal year 2023 to 21% of the total transaction value, highlighting a substantial shift towards online investment methods.
Key Market Challenges
Market Volatility and Economic Uncertainty
Fluctuations in global markets and economic instability can lead to investor apprehension. Periods of market downturns may result in reduced investments in mutual funds, as investors become more risk-averse, impacting the overall growth of the market.
Regulatory Changes and Compliance Costs
The evolving regulatory landscape requires asset management firms to adapt continuously, which can be resource intensive. Compliance with diverse regulations across different regions can increase operational costs and complexity, potentially affecting profitability and market expansion.
Competition from Alternative Investment Vehicles
The emergence of alternative investment options, such as exchange-traded funds (ETFs) and direct stock investments, presents competition with traditional mutual funds. These alternatives often offer lower fees and greater flexibility, attracting investors away from mutual funds.
Key Market Trends
Shift Towards Passive Investment Strategies
There is a notable trend towards passive investment strategies, with investors increasingly favoring index funds and ETFs that offer lower fees and have historically provided competitive returns. This shift is challenging traditional actively managed mutual funds to reassess their value propositions. In 2024, investors withdrew a record USD 450 billion from actively managed stock funds, highlighting a significant shift towards passive investing.
Integration of Environmental, Social, and Governance (ESG) Factors
Investors are increasingly considering ESG factors in their investment decisions, leading to a rise in sustainable and socially responsible mutual funds. Asset managers are responding by incorporating ESG criteria into their investment processes to meet the growing demand for responsible investment.
Technological Integration and Robo-Advisory Services
The adoption of technology in the form of robo-advisors and automated investment platforms is transforming the mutual fund industry. These platforms offer personalized investment advice and portfolio management at a lower cost, making investing more accessible to a broader audience.
Segmental Insights
Investment Strategy Insights
In the global mutual fund assets market, the Equity Strategy segment currently leads in terms of Assets Under Management (AUM). This dominance can be attributed to the strong performance of equity markets globally, where investors continue to seek capital appreciation. Equity funds provide diversified exposure to stocks, allowing investors to participate in the growth of businesses across various sectors and regions. Despite short-term market volatility, equity funds have historically delivered higher returns over the long term, making them a preferred choice for investors looking for higher yields. The large AUM in equity strategies is also fueled by the growing popularity of passive investment strategies, such as exchange-traded funds (ETFs) and index funds, which provide low-cost, broad exposure to the stock market. This has made equity funds attractive to both retail and institutional investors, contributing to their leadership position in the market.
Regional Insights
North America continues to dominate the global mutual fund assets market, holding a significant share of global Assets Under Management (AUM). The region's leadership can be attributed to its well-established financial markets, robust regulatory frameworks, and a highly developed investment infrastructure. The United States is home to the largest mutual fund market in the world, with major players like BlackRock, Vanguard, and Fidelity managing trillions of dollars in assets. In 2024, the combined assets of the US mutual funds increased by USD 971.36 billion, or 3.4 percent, to USD 29.14 trillion in November, according to the Investment Company Institute's official survey of the mutual fund industry. Additionally, a broad and diverse investor base, ranging from retail investors to large institutional players, contributes to the region's dominance. Investor confidence in North America's financial stability and economic growth has helped sustain the demand for mutual funds, especially equity and fixed income strategies. The widespread use of retirement savings vehicles such as 401(k) plans and individual retirement accounts (IRAs) further bolsters mutual fund investments. Consequently, North America remains the leader in the global mutual fund market.
In this report, the global mutual fund assets market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:
Company Profiles: Detailed analysis of the major companies presents in the global mutual fund assets market.
Global Mutual Fund Assets market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:
Detailed analysis and profiling of additional market players (up to five).