Growing investor participation is driving Sri Lanka unit trust performance, with assets under management reaching Rs. 597 billion by November 2025. Increased inflows and new investors highlight rising confidence in professionally managed, transparent investment solutions across the country.
Sri Lanka unit trust industry sees record growth and expanding investor base
Sri Lanka’s unit trust industry is experiencing remarkable growth, fueled by increasing investor participation and confidence in professionally managed funds. According to recent reports, the industry’s assets under management (AUM) reached Rs. 597 billion by the end of November 2025, marking a 16.5% year-over-year increase. These assets are managed across 85 funds by 16 licensed management companies, demonstrating the sector’s robust structure and regulatory compliance.
The surge in AUM is largely supported by strong inflows into equity-related funds, which recorded Rs. 3.4 billion in new investments in November alone. Additionally, the market welcomed 2,945 new unit holders during the month, bringing the total year-to-date increase to 27,720 new investors. As of end-November, the total number of unit trust investors stood at 141,252, reflecting an impressive 25% growth compared to the previous year. This trend indicates the growing familiarity and acceptance of unit trusts as an accessible alternative investment tool among Sri Lankan investors.
Speaking on the importance of unit trusts in enhancing capital markets, Prof. Hareendra Dissabandara, Chairman of the Securities and Exchange Commission of Sri Lanka (SEC), emphasized their role in promoting financial inclusion. “Unit trusts open the door for ordinary citizens — even those with small savings — to become investors. This builds financial inclusion, encourages savings to flow into productive investments, and ultimately strengthens our capital market and national economy,” he stated.
Prof. Dissabandara further highlighted the security and transparency inherent in unit trust investments. “Every investment carries some risk, but unit trusts are one of the safest ways to invest in the market. They are regulated by the SEC and held under the custody of independent trustees — often banks — who ensure that your money is not misused. The funds are required to disclose their performance regularly, so investors can see how their money is growing. Transparency and accountability are built into the system.”
Industry experts also view the recent performance as a reflection of effective investor education initiatives. Kavin Karunamoorthy, Vice President of the Unit Trust Association of Sri Lanka (UTASL) and CEO of First Capital Asset Management Limited, commented: “We are extremely encouraged to see the upward direction the industry has been heading in this past year. However, there is more to be done. With the success of our ‘Investor Awareness Initiative’ held in October, we remain focused on strengthening financial literacy and investor participation in unit trusts across the country.”
Karunamoorthy also highlighted collaborative efforts between the UTASL, SEC, and Colombo Stock Exchange (CSE). “The recently launched ‘A Share for Each – A Unit for Everyone’ national initiative by the SEC aims to activate and grow the investor base further. We believe these programs will encourage more Sri Lankans to explore professionally guided investment options while contributing to long-term national economic growth.”
The UTASL, representing all licensed fund management companies in Sri Lanka, plays a pivotal role in maintaining industry standards. Comprising 16 member companies regulated by the SEC, the association is dedicated to upholding professionalism, integrity, and transparency, while promoting unit trusts as a reliable and effective tool for long-term wealth creation.
As unit trusts continue to attract new investors and significant inflows, the industry’s growth reflects a broader trend of financial inclusion and literacy. By offering accessible, well-regulated investment options, unit trusts are enabling Sri Lankans from diverse financial backgrounds to participate in the capital market, thereby supporting national economic development.
For investors seeking more information on unit trusts or to connect with licensed fund management companies, visit www.utasl.lk. The increasing adoption of unit trusts demonstrates that structured, professional investment solutions are becoming integral to Sri Lanka’s financial landscape.