A recent survey conducted by Axis Mutual Fund nationwide showed an increasing number of women assuming control of their financial futures. This shift is significant because historically, investment decisions were predominantly male-dominated. The survey’s findings indicate a rising trend towards greater financial independence among women.
The survey also highlights that women prefer mutual funds, which can serve as an effective strategy for accumulating wealth towards long-term objectives. The survey findings clearly illustrate women’s strong inclination towards long-term and forward-thinking investment strategies. Their preference for longer investment durations resonates with the potential for stable returns enabled by compound interest.
What do Axis MF customers say?
Axis Mutual Fund examined data from more than 10 million customers for their 2024 Women Investment Behavior Report. Given the large number of participants, the results are expected to be reflective of the wider population of female mutual fund investors across India.
The survey’s emphasis on existing customers indicates a narrower scope primarily within Axis Mutual Fund’s customer base, which may restrict its applicability to all female investors in India. Nevertheless, it offers valuable insights into the investment behavior of a significant cohort of actively involved women.
Addressing the significance of the study, B Gopkumar, MD & CEO, Axis AMC asserted, “The mutual fund industry is undergoing a dynamic shift as more people, particularly women, embrace investing in mutual funds as part of their financial strategy. Our research into the investment patterns of Axis MF investors reveals that women constitute 30% of the Axis Mutual Fund customer base and hold 35% of the total AUM. Understanding the evolving investor landscape, especially regarding women’s preferences, is crucial for continued growth and our report aims to shed light on this aspect. By analysing their distinct needs and investment behaviour, Axis AMC aims to refine our offerings to empower their financial journeys. This is fuelled by innovative digital tools and comprehensive education programs.”
The main finding from the survey is that 72% of women investors are making decisions independently, signalling a notable shift towards financial autonomy among women.
The report underscores two primary trends:
- Increased average investments: Women, on average, are investing 37% more in mutual funds, demonstrating a robust dedication to wealth accumulation. This trend may stem from factors such as long-term financial planning or potentially greater risk tolerance.
- Emphasis on long-term goals: According to the report, women show a preference for long-term investment strategies, which align effectively with mutual funds designed for objectives such as retirement planning and wealth creation. This approach stands to benefit from the compounding effect over time.
These findings challenge conventional stereotypes suggesting that women are inherently more risk-averse when it comes to investing.
Women’s investing behaviour
Additionally, additional insights from the survey further substantiate the trend of women as resilient and strategic investors. Here’s an analysis of what this reveals:
- Increased investment and endurance: Women not only demonstrate a higher average investment rate (37%) but also exhibit a longer-term commitment, staying invested for extended periods (22% longer over a five-year timeframe). This persistence underscores their disciplined approach and dedication to achieving long-term objectives.
- Opportunity for enhanced returns: Extended investment periods can significantly leverage compound interest. By maintaining longer-term investments, women have the potential to achieve greater returns on their investments.
- Digital integration: The rapid increase in women utilizing fintech platforms (rising from 14% to 55% in just five years) demonstrates their enthusiastic adoption of digital tools for financial management. This trend augurs well for advancing financial inclusivity and underscores the tech proficiency of women investors.
- Investment education: According to the report, these platforms are complemented by educational programs, empowering women with the necessary knowledge to invest with confidence.
- Risk tolerance differs across geographical regions: Women residing in B30 cities may prioritize security, opting for traditional, lower-risk investments such as fixed deposits and gold. In contrast, those in T30 cities might exhibit a higher comfort level with risk, exploring growth-oriented options such as stocks and startups.
- Financial literacy: In all likelihood, women in T30 cities benefit from increased access to financial education or investment guidance, which could contribute to their greater comfort with exploring newer investment avenues.
The insights from the report challenge the stereotype that women are less adept in technology or finance. It suggests that women are actively pursuing financial literacy and leveraging digital tools to make informed investment decisions.
Ashish Gupta, CIO, Axis AMC further added, “The findings of our ‘Women Investment Behaviour Report 2024’ paint a truly inspiring picture. Women participation in the investor base is rapidly rising with demonstrably high independence and increasing sophistication. They have a data-driven approach and have quickly adopted digital tools for their investing. Their focus on long-term goals and consistency is driving impressive investment outcomes for them. The fact that our 2.2 million women investors have made an average gain of over Rs. 80,000 speaks volumes about their growing financial acumen.”
The report presents a highly positive outlook on the increasing involvement and sophistication of women in the investment arena. Importantly, it dispels conventional beliefs about women being risk-averse investors, showcasing their rising confidence, strategic acumen, and adoption of technology. These factors empower women to proactively manage their financial destinies, benefiting both their individual well-being and the broader economic landscape.