Why did 1.40 Cr? Enter the stock market in 2020 even after the lockdown? Investors

We saw many unique pictures during the lockdown brought to deal with the corona infection. Some kitchen, some cinema, while some were engaged in their new hobby. At the same time, while people were also struggling with the economic crisis, on the other hand, the stock market, which was considered riskier, was wooing new young investors. Statistics show that in 2020, people who were badly affected by Corona made rapid strides towards equity market investment.

Investors in the stock market are growing rapidly

In the past months, the number of investors investing for the first time in the Indian stock market has increased rapidly. According to the available data, in the year 2020 alone, about 14 million people have opened the demat accounts required for trading in the stock market. In the earlier years, this figure had not even reached 50 lakhs. The retail share of companies listed on the National Stock Exchange (NSE) increased by more than 9% in the third quarter of 2020 due to investment from growing retail (small) investors. This is the highest since March 2018 levels.

Why is the market appealing?

Who does not like to earn fast and fat quickly?

The free time of lockdown gave people a good opportunity to understand the market. Other investment options such as lower interest rates from banks also had a major impact on it. Recently, competition has increased significantly for brokerage. This has given investors a choice of better, economical investment and easier KYC rules. Easily available information on YouTube and various social media has helped new investors. The expansion of mobile and internet services is also the reason for the investment trend by the youth and new investors especially from small towns.

In 2015, 95% of our business was through the desktop trading platform. Now 75% of the trading is done through the mobile app.

Lockdown is over, new investors are not enthusiastic

The huge interest shown in the equity markets during the lockdown continues till now. In January 2021, CDSL added about 1.4 million new customers. This is about 3 times the number of January of the previous year. In February this year, more than 13 lakh people have opened accounts with CDSL. In this time of recovering economy from Corona, the attractiveness of investors has increased in this market also. Experts also attribute this growing interest in the market to SEBI. Investors’ confidence in the equity market has been strengthened due to good regulation.

According to data from the Association of Mutual Funds in India (AMFI), investment in equity funds of mutual funds increased by 16% this year as compared to February 2020.

India’s equity market is still small

Despite the number of investors growing in India, we are far behind most countries in equity investment. According to data collected by Bloomberg from various sources, as of December 2020, 48% of household assets in India were in properties. After this, the highest 17% asset is in the form of gold. Bank deposits constitute 16% of the total assets, insurance-pension funds 11%, while cash is 4%. In the equity market this way is only 4%. 55% of people in the US engage in the equity market either directly or through mutual funds. This is more than 12.7% in China. In the coming days, it is expected that India should move faster than its current number of around 3.7% of its total population.