Aided by strong inflows into debt-oriented schemes, mutual fund (MF) houses witnessed an overall inflow of Rs 1.2 lakh crore in January 2020 as compared to an outflow of Rs 61,810 crore in December 2019, taking the industry’s asset base to an all-time high of Rs 27.85 lakh crore.
According to the Association of Mutual Funds in India (AMFI), debt-oriented schemes recorded strong inflows of around Rs 1.09 lakh crore. Among debt-oriented schemes, liquid funds — with investments in cash assets such as treasury bills, certificates of deposit and commercial paper for shorter horizon — received flows worth about Rs 59,683 crore, the highest among the fixed-income segment last month.
The monthly contribution of systematic investment plans (SIPs) hit an all-time high inflows of Rs 8,532 crore in January and its total assets under management (AUM) of Rs 3.25 lakh crore is a recognition of the retail investors’ acceptance of mutual funds as a long-term wealth creation avenue, amid market volatility, AMFI CEO N S Venkatesh said.
The MF industry logged an AUM of Rs 27.85 lakh crore by January-end, as against Rs 26.54 lakh crore at the end of last December, representing a growth of 5 per cent, according to AMFI data. At the end of January 2019, the asset base of the industry had stood at Rs 23.37 lakh crore.
According to AMFI, equity funds also saw higher inflows. Open-ended equity and equity-linked saving schemes witnessed an infusion of Rs 7,877 crore, while there was an outflow of Rs 330 crore in close-ended equity plans, taking total equity inflows to Rs 7,547 crore last month. In December, net inflow in such schemes stood at Rs 4,432 crore.
“Mutual fund industry’s AAUMs (average assets under management) stood at an all-time high of Rs 28.18 lakh crore in January, driven by positive flows in all categories of open-ended schemes and growing retail monthly SIP contribution,” Venkatesh said, adding, “We expect this positive growth momentum in mutual fund AUMs to continue, driven by growth-oriented budget and RBI stance on continuing benign Interest Rate cycle, resulting in 15 to 20 per cent growth for the mutual fund industry this fiscal.”
Besides, gold exchange-traded funds saw an inflow of over Rs 202 crore after witnessing an inflow of Rs 7 crore in the preceding month. Prior to that, the safe-haven asset saw an infusion of Rs 31.45 crore last October, Rs 44 crore in September and Rs 145 crore in August. In addition, overnight funds, investment in securities with a maturity of one day, received flows worth about Rs 22,652 crore.
Industry experts said retail investors may continue investing in the markets through SIPs, while staying balanced in their investing approach between different asset classes.
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