According to distributors and fund managers, investments through systematic investment plans (SIPs) are picking up leading to an increase in inflows in mutual funds.
SIPs allow investors to regularly invest small amounts instead of making lump sum investments at various points of time. Such investments are usually made on a monthly or quarterly basis.
Mutual funds do not see these strong inflows abating, even as valuations look stretched.
Here’s Why You Should Invest In Equity Mutual Funds
Inflows into equity schemes of mutual funds through systematic investment plans (SIPs) have been steadily on the rise.
Average monthly SIP inflows so far in FY18 have been Rs 4,636 crore, up 27 percent over the monthly average of Rs 3,626 crore last year, according to data collated by the Association of Mutual Funds.
Falling returns from traditional investment avenues like fixed deposits, real estate and gold is one of the main reasons for the massive inflows into mutual funds. An equally important driver has been demonetisation. Strong inflows have triggered a virtuous cycle wherein rising stock prices are attracting more money.