Niche marketing helps funds beat downturn

: When the going gets tough, the tough gets going. Post the ban on entry load, many mutual fund players have realigned their business strategy to focus on their ‘niche’ segments. It was in August 2009 that the market regulator imposed a ban on the entry load and ever since the sales of equity schemes–the bread and butter of mutual fund industry— have been falling. Not to mention the poor equity markets giving little headroom to launch new fund offering (NFO). However two years later, the ‘niche’ positioning that many fund houses had adopted to market their products is helping them survive the downturn.

Some of the fund houses such as Goldman Sachs (formerly known as Benchmark MF), Motilal Oswal and more recently launched India Infoline MF are now focusing on ‘passively’ managed products. Passively managed funds could be exchange traded funds, index funds or quant funds which as the name suggests…

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