The mutual fund industry lost more than 36 lakh investors, measured in terms of individual accounts or folios, in the 2012-13 financial year.
The last fiscal marked the fourth consecutive year of loss of folios by mutual funds (MFs). During the preceding three financial years, the MF industry had lost over 15 lakh new investor accounts.
Folios are numbers designated to individual investor accounts, although one investor can have multiple folios.
As per the latest data compiled by market regulator Sebi (Securities and Exchange Board of India) on total investor accounts with the country's 44 fund houses, the number of folios have fallen to 4.28 crore at the end of March 2013 from 4.64 crore in the previous fiscal (2011-12), translating into a decline of 36.23 lakh new investor accounts.
In the past four financial years till 2012-13, the MF industry had lost more than 55 lakh new investor accounts.
MF sector, which held 4.75 crore folios at the end of financial year 2008-09, saw an increase of 3.66 lakh new investors account to 4.8 crore in 2009-10.
However, later the number of folios continued to witness a southward trend and tumbled to 4.28 crore during the past fiscal year.
Market participants attributed the sharp fall in number of folios to profit booking and various merger schemes in the mutual fund industry, among others.
In 2012-13, the number of investor folios for equity schemes fell by 44.7 lakh, while the debt funds recorded an increase of close to nine lakh as far as the number of new
investor accounts were concerned.
The total number of folios in equity funds plunged to 3.31 crore at the end of March 2013 from 3.76 crore in the previous financial year. Equity folios form over 70 per cent of the industry's total new investor accounts.
The huge decline in equity folios during the year coincided with a rise of about 8 per cent in the market benchmark Sensex.
The mutual fund industry has been facing consistent equity folio closures in the past few months.
As per Sebi data, the total number of folios in debt funds rose by 8.9 lakh to 61.38 lakh at the end of March 2013.
Besides, Exchange traded funds gained 1.15 lakh folios to 7.4 lakh investor accounts at the end of March, this year.
Balanced schemes, which invest in equity and debt category, shed 1.16 lakh folios to end at 26.02 lakh during the last fiscal.