At a time when both the Nifty-50 and Sensex have seen volatility with a downward bias, investors have continued to keep their faith in mutual fund schemes.
Net assets under management of mutual fund schemes rose to a new milestone of Rs 68 lakh crore. However, on a month-on-month basis, there was a 14% decline in equity inflows in November at Rs 35,943.49 crore. This was the biggest drop in the last seven months. Both the Nifty and Sensex were flat during the month, returning (-)0.31% and 0.52%, respectively.
The SIP (systematic investment plan) book continued to be the key driver, attracting Rs 25,319.66 crore, marginally lower than Rs 25,322.74 crore in October. This was the second consecutive month of SIP inflows crossing the Rs 25,000-crore mark.
The SIP accounts number hit a fresh record high of 102.3 million, compared with 101.2 million in October. However, the number of new SIPs registered during the month stood at 49,46,408, falling from 63,69,919 in October.
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“The industry’s ability to attract consistent SIP flows is a vote of confidence in its ability to deliver value to investors over the long term,” said Venkat Chalasani, chief executive of the Association of Mutual Funds in India.
Himanshu Srivastava, associate director, manager research, Morningstar Investment Research India, said: “The correction in the markets during the month provided a good investment opportunity for investors, which they didn’t fail to capitalise on. This logged the 45th consecutive month of net inflows into the segment.”
Ashwini Kumar, senior vice president and head of market data, ICRA Analytics, said weak global cues, China’s recent economic stimulus and escalating tensions between Ukraine and Russia adversely impacted the Indian equity markets as well. “While equity inflows fell on a month-on-month, on a year-on-year basis, inflows rose nearly 131.35%. This indicates the sustained interest among retail investors for investing in equity mutual funds.”
Despite the overall decline in equity inflows on a month-on-month basis, small-cap and mid-cap funds saw a positive trend, with inflows up by 9% and 4.3%, respectively. Conversely, large-cap and sectoral and thematic funds witnessed month-on-month declines of around 26.20% and 37.63%,
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