Investment: How Data Tells You Stories

Financial inclusion revolution is underway in India.

- RAJAS KELKAR

Numerous studies indicate a surge in the rate of conversion from savings deposits to equity investments. Records of demat accounts, mutual fund flows, and preferences for equity investments show the confidence households have in the prospects for the Indian economy. The latest monthly bulletin of the Reserve Bank of India highlights one multi-year study that shows a surge in equity inflows through mutual funds when prospects for India's growth are bright.

When prospects are relatively bleak, inflows into mutual funds weaken. The study also identifies three factors that discerning investors consider. These include an increase in demat accounts, fixed deposit rates and business confidence. All of that has translated into mutual funds managing a record of assets today compared to 15 years ago. If you look at the stock market, several asset management companies that manage your money have listed themselves. Their shares are trading at a multi-year high.