Assets Under Management (AUM)

Assets Under Management

Assets Under Management Latest News

The asset under management (AUM) of India’s mutual fund (MF) industry was estimated at ₹74.40 lakh crore, marking a more than sevenfold growth in 10 years, according to a recent report.

About Assets Under Management

  • AUM is a crucial metric in the financial industry, particularly in mutual funds. 
  • AUM refers to the total market value of the assets that a financial institution or investment company manages on behalf of its clients. 
  • These assets can include stocks, bonds, and other financial investments.
  • AUM is affected by:
    • Market fluctuations
    • Net investor inflows (new investments)
    • Redemptions or withdrawals
    • Dividend reinvestments
  • AUM is an essential measure of the size and success of a mutual fund, as it provides investors with insight into the fund's popularity and credibility. 
  • It also indicates the financial institution's expertise and ability to attract and retain clients. 
  • Additionally, investors often use AUM to assess the fund's liquidity and stability. 
  • The larger the AUM, the more resources and diversification potential the fund may have, which can attract investors seeking long-term growth and stability.
  • A mutual fund’s AUM can have a large impact on the fees that an investor usually pays to invest in the mutual fund. For example, some larger funds might have a very high minimum investment.

Source: TH

Assets Under Management FAQs

Q1: What is Assets Under Management (AUM)?

Ans: AUM is the total market value of the assets that a financial institution or investment company manages on behalf of its clients.

Q2: Why do investors often consider Assets Under Management (AUM) when selecting a mutual fund?

Ans: It reflects the fund’s popularity, expertise, and stability.

Q3: How does Assets Under Management (AUM) impact investor fees in a mutual fund?

Ans: Larger AUM funds may have high minimum investment requirements.

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