A Mutual Fund Industry in Pakistan

Abstract

The mutual fund industry in Pakistan has shown commendable performance in the past four to five years if we compare it to the decade of mid 60’s and 70’s when the public sector funds were overwhelming the market. But if we internationally compare our industry then there is a lot of room for improvement. The government has taken many supportive steps to nurture the industry and the results are obvious but much more descisive decisions are needed to erect our industry in front of international markets. More and more institutions are entering into the mutual fund business which shows encouraging growth but such regulatory procedures are needed that should not harm the small investor because their size and number really matter for the financial growth of our economy. The private sector is taking the leading role in the non-banking finance sector and the privatization of NIT is also a major step, which will change the financial outlook of mutual fund performance. Further innovative investment products are needed to match the return objective of investors which on one hand will diversify the risk potential of investments and on the other will mobilize the savings.