Mutual funds remain one of the favourite investment tools for Indian investors in second quarter (April-June) of 2010. According to the ING Investor Dashboard Survey, 72 per cent respondents said mutual funds were their preferred investment tool during the period. This is 2 per cent more than that of in the previous quarter.
Investors’ preference for deposits also grew during the second quarter with 72 per cent saying they would opt for bank deposits, 4 per cent more than in the first quarter of 2010. Among other investment tools, gold also showed an increased liking among investors with 68 per cent respondents choosing it as a favoured investment tool compared with 53 per cent in the previous quarter.
Among those respondents, who said they would be reallocating their portfolio during the quarter, 59 per cent chose mutual funds. Gold (56 per cent), stocks (53 per cent) and cash deposits (50 per cent) were other most preferred options among those looking to rejig their portfolio.
The ING Investor Dashboard Survey reveals that investor sentiment in India is once again the ‘most optimistic’ among pan-Asia (ex Japan) markets as strong domestic consumption continues to drive its economy and the government makes progress with implementation of domestic reforms. Investor sentiment index in India, however, dropped two points to 172 in second quarter compared with 174 in the previous quarter.
Navin Suri, managing director and chief executive officer of ING Investment Management India said, “The global economy is starved for growth pockets. India offers a compelling 8-9 per cent growth rate. There continues to be strong conviction that India is on its way to regain its ‘mega-economy’ status lost just 200 years ago to the West.”
He further said that the survey indicated that 89 per cent investors in India expect the economic situation in India to improve in next quarter, well above the pan-Asia average of 68 per cent.
The overall pan-Asia (ex-Japan) ING Investor Dashboard Sentiment Index dropped to 136 during the quarter from 145 in the first quarter. Despite the drop, investor confidence continues to remain in the optimistic territory for the fifth consecutive quarter and the Index registers an 86 per cent increase from the low of 73 in fourth quarter of 2008.
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