Equity Mutual Funds are witnessing positive momentum; ₹18,529 crore inflow recorded in May
Tracking positive momentum for the 15th consecutive month, equity mutual funds attracted a net amount of ₹18,529 crore in May amid heavy volatility in the stock markets and continued selling by foreign portfolio investors (FPIs).
This was much higher than the net inflow of ₹15,890 crore in April, data from the Association of Mutual Funds in India (AMFI) showed on June 9.
Equity schemes are witnessing net inflows since March 2021, highlighting the positive sentiment among investors.
Earlier, such schemes saw continuous outflows for eight months from July 2020 to February 2021, incurring a loss of ₹46,791 crore.
All equity-oriented categories received net inflows in May, with the Flexi Cap Fund category being the biggest beneficiary with a net inflow of ₹2,939 crore.
In addition, large-cap, large and mid-cap funds and sectoral/thematic funds saw a net investment of over Rs 2,200 crore each.
Gopal Kavalireddy, Head of Research, FYERS said, “Even with high volatility in markets, uncertainty due to Ukraine-Russia war, supply chain disruptions, high inflation and low economic growth projections, investors can choose equity mutual funds. are.”
Inflows through SIPs (Systematic Investment Plan) increased to ₹12,286 crore in May from ₹11,863 crore in April, indicating that retail investors continue to have confidence in equity investments. This is the ninth consecutive month of SIP inflows exceeding ₹10,000 crore, a trend that began in September 2021 with ₹10,351 crore inflow.
Apart from equities, the Gold Exchange Traded Fund (ETF) category saw an inflow of ₹203 crore.
On the other hand, the debt category saw a net outflow of ₹32,722 crore in May after net inflow of ₹69,883 crore in the previous month.
Overall, the mutual fund industry recorded a net withdrawal of ₹7,532 crore last month as compared to a net inflow of ₹72,846 crore in April.
“Mutual fund negative net inflows are the result of a rising interest rate cycle, in which investors redeem their investments from money markets and short-term funds,” he said.
The total outflow pulled the average assets under management (AUM) of the industry to Rs 37.37 lakh crore at the end of May, from Rs 38.89 lakh crore at the end of April.