Unit trust industry assets swell 16% to Rs.603bn as investor appetite grows

• Assets under management top Rs.603bn, up 16% YoY
• Equity funds attract Rs.4bn in October as risk appetite grows
• Over 25,000 new investors enter market so far this year

The unit trust industry in Sri Lanka has recorded a robust performance, with assets under management (AUM) expanding by 16.0 percent year-on-year to reach Rs.603 billion by the end of October 2025.

The sector saw assets rise from Rs.592 billion in September, signalling a steady shift in public sentiment towards professionally managed investment vehicles. However, despite this impressive double-digit growth, the industry remains a fraction of its true potential. Industry experts note that unit trusts still account for a mere 1.5 percent of the total financial assets held by the public, underscoring the massive opportunity for expansion in a market that has historically been dominated by traditional savings accounts and fixed deposits.

The industry, which currently comprises 85 funds managed by 16 distinct management companies, witnessed a surge in retail participation with 3,628 new unit holders entering the market in October alone. This latest influx brings the total number of investors in the industry to 137,224. On a year-to-date basis, the industry has successfully onboarded nearly 25,000 new investors, reflecting the impact of sustained awareness campaigns and a changing investment landscape.

A notable trend observed in October was the specific influx of approximately Rs.4 billion into equity-related funds. This movement suggests that investors are increasingly willing to look beyond traditional, risk-averse savings methods. It indicates a growing confidence in the long-term growth potential of Sri Lanka’s capital markets and an appetite for diversified investment portfolios designed for wealth creation.

Speaking on the industry’s trajectory, Unit Trust Association of Sri Lanka (UTASL) President and CEO of JB Financial, Christine Dias Bandaranaike, noted that the sector has performed “remarkably” in 2025, having surpassed the Rs.600 billion mark earlier in the year.

“We continue to see strong potential for market growth, driven by increasing investor awareness and a broader range of fund offerings,” she said.

Bandaranaike further highlighted the impact of the recently concluded ‘Investor Awareness Initiative’, which was held from October 27 to 31. The event, which saw the participation of all 16 management companies, focused on educating the public on wealth building and reinforced the importance of making informed, long-term investment decisions.

The UTASL, in collaboration with the Securities and Exchange Commission (SEC) and the Colombo Stock Exchange (CSE), remains focused on strengthening financial literacy across the island. While pooled funds are a standard investment tool globally, local participation remains relatively low. The association aims to popularise these instruments to encourage Sri Lankans to prioritise professionally guided investing alongside short-term savings, ultimately contributing to national economic growth.