Asset Management Companies (AMCs) pool money from investors and invest it in various assets like stocks, bonds and other securities to generate returns. They not only take care of your portfolio’s return and risk, but ensure that the mutual funds comply with regulations. AMCs offer a range of mutual fund schemes catered to different investment objectives and risk profiles.
Most people don’t have the time or knowledge to research and manage a diverse portfolio of investments. AMCs bring in that expertise and experience, aiming to make the most of your money. By pooling money from many investors, mutual funds can buy a variety of investments than that of what an individual can afford alone. This spreads out risk. So if one investment doesn’t do well, others might perform better and balance things out. Hence, investing through a mutual fund managed by an AMC is much easier than managing multiple investments by yourself.
What Do You Mean by Asset Management Companies?
An Asset Management Company (AMC) is a financial institution that pools funds from many investors and invests them in a diverse range of assets to generate returns. The goal of an AMC is to meet your financial goals by managing your investments. Think of it like a service where professionals handle your money to help it grow. They decide where to invest the money, such as in stocks, bonds, real estate or other assets. So that your funds increase their value over time.
What Is A Mutual Fund?
A mutual fund is a vehicle that pools money from investors, to invest in different markets and securities. Think of a mutual fund as a group project where everyone pitches in some money to reach a common goal. So, you and a bunch of other people each put some money into a big pot. This combined money is the mutual fund.
This big pot of money is now used to buy many investments like stocks, bonds, commodities and other assets. Whatever profit (or loss) these investments make is shared among everyone who contributed to the pot, based on how much they put in. By pooling money, everyone can invest in a wider variety of investments than they could on their own, spreading out the risk and potentially earning more money.
What Types Of Assets Are Managed By AMCs?
AMCs manage a variety of funds. These can include stocks, bonds, real estate, commodities and other alternative investments. The primary goal of an AMC is to diversify your portfolio and generate returns through these diverse asset classes. The specific types of assets managed by an AMC depend on its investment strategy and your needs, which can range from individual investors to large institutional investors.
How Many AMCs Are There In India?
According to the Association of Mutual Funds in India (AMFI), there are 44 AMCs or mutual fund houses operating in India.
Here is a list of the top 10 AMCs in India as per their Average Assets Under Management (AAUM):
| AMC | AAUM (₹ in lakhs)* | No. of Equity Funds | No. of Debt Funds | No. of Hybrid Funds | No. of Index Funds | No. of Fund of Funds | No. of Solution-Oriented Funds |
| SBI Mutual Fund | 91590153 | 62 | 76 | 28 | 30 | 6 | 10 |
| ICICI Prudential Mutual Fund | 71155309 | 77 | 85 | 22 | 54 | 48 | 9 |
| HDFC Mutual Fund | 61767776 | 59 | 64 | 25 | 19 | 5 | 3 |
| Nippon India Mutual Fund | 43389692 | 42 | 115 | 33 | 53 | 12 | 4 |
| Kotak Mahindra Mutual Fund | 38400734 | 57 | 42 | 18 | 42 | 16 | 0 |
| Aditya Birla Sun Life Mutual Fund | 33257931 | 61 | 70 | 19 | 42 | 33 | 14 |
| UTI Mutual Fund | 29099303 | 44 | 167 | 24 | 15 | 2 | 3 |
| Axis Mutual Fund | 27516600 | 41 | 91 | 30 | 45 | 29 | 8 |
| Mirae Asset Mutual Fund | 16446760 | 29 | 35 | 15 | 12 | 12 | 0 |
| DSP Mutual Fund | 14808158 | 41 | 38 | 18 | 25 | 24 | 0 |
* Source: AMFI Report on AAUM of Fund Houses for the quarter of January – March 2024.
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What Is AUM And AAUM?
Assets Under Management (AUM) is the total market value of all the investments that a financial institution, like an AMC, manages on behalf of its clients. Think of it as the total amount of money that the AMC is responsible for investing.
Average Assets Under Management (AAUM) is the average value of the assets that an AMC manages over a specific period, usually a month, a quarter or a year. It’s calculated by averaging the AUM at different points in time within that period.
Who Regulates The AMCs?
The Securities and Exchange Board of India (SEBI) regulates asset management companies as known as mutual fund houses. It oversees mutual funds in India by protecting investor interests and making sure there is market integrity. As the capital market regulator of India, SEBI’s mandate is mandatory for all mutual fund operations.
What Role Does AMFI Play In An AMC?
The Association of Mutual Funds in India (AMFI) is a self-regulatory organisation that represents the mutual funds operating in India. It acts as a nodal agency for the mutual fund industry and provides information on mutual funds and investments.
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