Indian economy, Equity schemes, mutual fund, mutual fund assets, mutual funds sector

Mutual Funds Saw an Outflow of Rs 2,724 crore in October

Business Finance

The pandemic of Covid-19 came with stress for all the people. And this is the same for the financial market too. People who invest in the stock market, mutual funds, bonds, and many more were reluctant to invest. But slowly and gradually, people were coming back on the track.

The stock market of India is almost back on track. But the mutual funds are still experiencing outflows. In the month of October, there was an outflow of Rs 2,724 crore. And this is when, when the stock market is on the bull stage. But at the same time, the debt market received inflows of Rs 1.10 lakh crore. And now Mutual Funds Assets Under Management are at the highest point. This is because now they crossed the point of Rs 28.22 lakh crore.

The Association of Mutual Funds also gave information about other types of mutual funds. The multi-cap funds are also experiencing outflows. And in October, they saw an outflow of Rs 1,902 crore. And at the same time, sectoral and thematic funds witnessed net flows of Rs 2,214.67 crore. This is because of two NFOs that were due.

Data of Outflows and Inflows in Mutual Funds

The mutual fund industry saw a general positive progression of Rs 98,575.96 crore in October 2020. During October 2020, SIP accounts developed to 3.37 crore, prompting an ascent in the month to month SIP commitment to Rs 7,800 crore when contrasted with Rs 7,788.37 crore in September. Complete SIP AUM rose from Rs 335,571.57 crore as of September to Rs 342,018 crore as of October 2020. The surge altogether directed for the crossover plot class at Rs 1,681.87 crore for October 2020 when contrasted with Rs 4,219.01 crore in September 2020 and Rs 4,819.45 crore for August 2020.

There are many reasons for the huge inflows too. These reasons are liquid money market, corporate bond fund, short duration, ultra-short duration, low duration and banking, and PSU fund categories.

NS Venkatesh, CEO, AMFI said: “The rise in both SIP contribution and SIP AUMs during October 2020 and continued slowing outflow in equity schemes reinforce the retail investor confidence in the mutual fund as an asset class. This trend is reflective in the economy improving further with green shoots amply visible — attractive interest rates, rise in GST collections, digitalization-driven efficiencies making Indian corporates healthier, conducive GoI policy for attracting FDI and continued surge in FII investment coupled with favorable geopolitical scenario would continue to keep Indian equity markets an attractive investment destination over a long term.”