Mutual funds lost 10 lakh investors, measured in terms of individual accounts or folios, in April-June 2013-14 due mainly to profit booking and various merger schemes in the industry.
Folios are numbers designated to individual investor accounts, although one investor can have multiple folios.
According to SEBI data on total investor accounts with 44 fund houses, the number of folios fell to around 4.18 crore at the end of June 2013, from 4.28 crore in the last fiscal (2012-13).
Market participants attributed the sharp fall in the number of folios to profit booking and various merger schemes in the mutual fund industry, among others.
During the April-June period of 2013, the number of investor folios for equity schemes fell by 11 lakh. The total number of folios in equity funds were 3.20 crore at the end of June against 3.31 crore at March-end.
The mutual fund industry has been facing consistent equity folio closures in the past few months, although the pace of decline slowed down in June.
SEBI Chairman U. K. Sinha, last month, had also raised concern over the continuous decline in folios in recent quarters.
The decline in equity folios during the first half of the year is in line with a slight decline of 30 points in the market benchmark Sensex.
According to the SEBI data, the total number of folios in debt funds rose by about 1.7 lakh to 63 lakh at the end of June 2013. Besides, exchange traded funds gained 6,558 folios to 7.46 lakh investor accounts at the end of June this year.
Balanced schemes, which invest in the equity and debt category, shed 73,415 folios to end at 25.3 lakh at the end of June.
The mutual fund industry lost more than 36 lakh investors in 2012-13. The last financial year also marked the fourth consecutive year of loss of folios by mutual funds. During the preceding three financial years, the mutual fund industry had lost over 15 lakh new investor accounts.