Paytm Money Annual Report 2021 – The Millennial Investor Matures; tax saving, long term investments top the charts5 min read
- Millennials continue to lead India’s retail participation in equity markets and are fast becoming mature investors
- Trends from equity segment showed diversification with 30 stocks traded on avg per user in 2021 vs just 12 in 2020; average equity AuM per user tripled in 2021
- Their risk appetite was higher as 42% millennials invested in small cap mutual funds (vs 31% in 2020)
- Increased discipline reflected by 30% rise in avg SIP transactions per user & 16% rise in avg SIP amount
- Proportion of millennials investing in long-term tax saving instruments such ELSS funds & NPS also witnessed a steep rise
- Paytm-owned Wealth Community continues to be the knowledge platform for millennials, as they spent 2,880 hours to get a better understanding on IPOs, trading personal finance and so on
One97 Communications Limited that owns the brand Paytm, India’s leading digital ecosystem for consumers and merchants, today announced that its wholly-owned subsidiary Paytm Money has released its Annual Report for 2021.
Paytm Money is contributing to wealth creation in the country by offering investment products including Direct Mutual Funds, Stocks, IPO, F&O, ETF, & NPS on the platform. The detailed report shares how Paytm Money’s investors grew their wealth over the last year and their top picks for investment.
Millennials all the way
India’s retail participation in equity markets remained strong in 2021. It was once again led by the millennial investors with nearly 80% of Paytm Money investors under the age of 35. But over the last year, the new millennial investor ‘grew up’.
Diversification and discipline were evident from their investment patterns. Millennial investors also took an increased interest in long-term tax-saving products indicating a mature approach towards investing. They also continued to be price sensitive as they kept an eye out for savings on trading brokerage and commissions.
Equity AuM triples
Within the equity segment, the average assets under management per user on the platform tripled in 2021. Average number of stocks traded per user also went up from 12 to 30 indicating higher diversification. Proportion of millennials buying ETFs in 2021 also saw a sharp rise with the average number of ETFs within the portfolio increasing by 50%.
Intraday trading becomes popular
Trading activity by millennials was high in 2021. Proportion of millennial users trading intraday jumped from 39% in 2020 to 50% in 2021 while the F&O segment witnessed 327 trades on average per user. 70% of millennial users applied for IPOs with 8 applications on average per user.
Higher risk appetite
Higher risk appetitePassive investing continued to be favoured by millennials as the average investment amount per user in mutual funds saw a 35% rise. Overall assets under management for this segment more than doubled last year, growing by 109%.
There was however, an increased preference for small cap funds indicating higher risk appetite. 42% of millennials invested in small-cap funds in 2021 up from 31% in 2020. Among the 10 most traded mutual funds on Paytm Money, 3 belonged to the small-cap category while 1 belonged to the mid-cap category.
‘Save the tax’
‘Save the tax’Mutual fund SIP trends show an increased discipline among millennial investors. In 2021, there was a 30% rise in the average number of SIPs per user with the average SIP value increasing by 16%. A similar preference was also seen for ELSS funds with average investment in these funds rising by 23%.
Proportion of millennials investing in ELSS funds also increased from 26% in 2020 to 31%. Given these funds are tax saving instruments with a 3-year lock-in period, the above numbers point towards a mature approach towards investing.
Millennials are now thinking long-term
Also worth noting that the number of millennials investing in the National Pension Scheme more than doubled in 2021. Overall assets under management for NPS also grew by 389% with investments made through Paytm Money platform.
NPS is an extremely long-term investment with tax optimization benefits and a preference for such investments among millennials indicates their long-term commitment towards investing.
Lots of learning with Paytm’s Wealth Community
Lots of learning with Paytm’s Wealth CommunityUsers also showed an inclination to better understand financial markets. More than 55,000 users watched at least one video on Paytm’s Wealth Community with the total amount of time watched at 2,880 hours.
Users were particularly interested in IPO analysis as ‘Zomato: Detailed IPO’, Glenmark: IPO, and Live Market Analysis were the most viewed sessions.
Female power grows
Female power growsAnother interesting trend was that the number of female invested users more than doubled over the past year growing by 114% and a higher percentage of female investors were profitable as compared to their male counterparts.
Varun Sridhar, CEO, Paytm Money said, “2021 was a transformative year for the Indian stock markets. In the past year, we saw millennial investors mature as they sought to diversify their portfolios and invest for the long term. Higher participation in intraday trading and F&O also indicated growing confidence. It was highly encouraging to see these investors spend a significant amount of time on learning financial concepts. These trends bode well for India’s young investors and we are excited about the future.”
Overall, 2021 was the year that saw India’s millennial investors evolve significantly. These users are now investing for the long-term, diversifying their portfolio, and also having a higher risk-appetite.
Disclaimer- “Investment in securities market are subject to market risks, read all the related documents carefully before investing. Paytm Money Ltd SEBI Reg No. Broking – INZ000240532. NSE (90165), BSE (6707). Depository Participant IN-DP-416-2019. Depository Participant Number: CDSL – 12088800. #SEBI Reg No. INA100009859/ NPS ePOP: 269042019. Regd. Office: 136, 1st Floor, Devika Tower, Nehru Place, Delhi – 110019. The securities quoted are exemplary and are not recommendatory. This information is purely based on internally available data and in no way to be considered as advice or recommendation. For detailed Disclaimer and Terms and Conditions, please visit www.paytmmoney.com. Mutual Funds and NPS offering is non Exchange traded products and Paytm Money Ltd (PML) is acting as an agent for distributing the same. Please note all disputes with respect to the distribution activity, would not have access to Exchange investor redressal forum or Arbitration mechanism.”
