The mutual fund industry is going through a lot of crisis. New money is not coming in, people from other industries are not too keen to join the industry, aum is falling. Of the new money that is coming, it is clear that the older and bigger funds are doing well, but the smaller ones are not able to collect money.

On the other hand there is tremendous poaching internally – and salaries are keeping pace with the other parts of the BFSI if not with the whole Indian corporate.

If you think it is a contradiction you are wrong. Most of the promoters are big rich companies who do not mind losing a couple fo 100 crores …just to say ‘we have the full range of financial services’….anyway read..what Sucheta Dalal and Debashis Basu have to say about the A.U.M…interesting.

http://www.moneylife.in/article/huge-mutual-fund-outflow-points-to-a-much-deeper-malaise/16202.html#comment-13557

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  1. what was that raghuram rajan said to alan greenspan?
    also regulators are the jokers who could not trade if their life depended on it. so why have expectations of ‘good regulators’? its an oxymoron.In India regulators are socialists and entrepreneurs are crony capitalists. So the customer/investor gets the thin end…

  2. well,now that distributors and the loads have been killed for MFs,the distributors can go and raise more money for FDs and whatever pays them a commission.way to go, Bhave -by eliminating the entry loads,you have thrown the baby away with the bathwater .no more entry loads,no more new investors.it is interesting to note that the big MFs are the beneficiaries.any wonder ? regulators always end up benefitting the big guys.
    whenever a babu trots out “market externality”,his face should be smacked with the danda of “unintended consequences”.

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