Equity schemes of mutual funds (MFs) witnessed net outflows of Rs 2,480 crore in July for the first time in over four years, despite a 7.5 per cent rise in the benchmark Nifty index during the month.
As per figures released by the Association of Mutual Funds of India (Amfi), eight out of 10 equity-oriented MF categories had seen net outflows in July with multi-cap funds registering the worst outflows to the tune of Rs 1,033 crore in July. Mid-cap funds witnessed outflows of Rs 579 crore.
Other equity categories including large cap, large & mid cap, small cap, value funds, dividend yield funds and sectoral funds also saw negative net inflows in July. Total assets under equity schemes are now at Rs 7.37 lakh crore. Investors booked profits in July when the market recovered, said an analyst.
However, debt schemes saw a huge jump in net inflows at Rs 91,392 crore as against net inflows of Rs 2,862 crore in June. Liquid funds received inflows of Rs 14,055 crore in July and low duration fund Rs 14,219 crore. Hybrid schemes saw outflows of over Rs 7,301 crore in July with arbitrage funds registering net outflows of Rs 3,732 crore, Aggressive hybrid funds saw outflows of Rs 2,196 crore in July.
Meanwhile, inflows through SIPs (systematic investment plans) declined to Rs 7,830.66 crore in July as against Rs 7,917 crore in June.
“The outflows from equity are quite negligible and it may stabilise over the next few months. While we may see the current trend continuing to prevail in the shorter term, the course may be steadied on the availability of more macro data in the coming months,” said Joseph Thomas, head of research, Emkay Wealth Management.
Amfi said the total assets under management (AUM) of the MF industry stood at Rs 27.11 lakh crore as against Rs 25.48 lakh crore in June.
NS Venkatesh, Chief Executive, Amfi, said: “Investor confidence in the markets continues to be robust, going by the rising net fresh SIP registrations and overall mutual fund average AUMs increasing since the advent of the pandemic. Debt mutual fund schemes are an attractive proposition with benign interest rate environment leading to better yields as also superior risk management by the debt fund managers.’’
Thomas said the net inflows into debt funds show a healthy uptick overall with an inflow close to Rs 91,400 crore.
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