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Last Updated : Jan 08, 2020 06:20 PM IST | Source: Moneycontrol.com

Mutual funds witness highest ever monthly SIP inflows in December

SIP inflows in November stood at Rs 8,273 and in 2019, total inflows via SIP was worth Rs 98,612 crore.

The mutual fund industry saw its highest ever monthly inflows through systematic investment plans or SIPs in the month of December.

According to the data on the Association of Mutual Funds in India, MF industry registered total SIP inflows of Rs 8,518.47 crore in December, a growth of 3 percent over November and six percent growth year-on-year.

SIP inflows in November stood at Rs 8,273 crore and in 2019, total inflows via SIP was worth Rs 98,612 crore.

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Currently, mutual funds have about 2.98 crore SIP accounts through which investors regularly invest in mutual funds.

The assets under management (AUM) of SIP also touched an all-time high of Rs 3.17 lakh crore.

NS Venkatesh, Chief Executive Officer, AMFI said, “Retail Investors continue to repose trust in Mutual Funds as reflected by continued flows through SIPs, despite challenging domestic economic scenario and global trade issues and conflicts. Markets have rallied and indices scaled new peaks, which is reflective of resolution coming through structural policies like (Indian Bankruptcy Code) IBC and lowering of Interest Rates, as also, expectation from Budget.''

AMFI data shows that the MF industry added, on average, 9.55 lakh SIP accounts each month during the FY2019-20, with an average SIP size of about Rs 2,850 per SIP account.

Overall, the average AUM of the 43-player mutual fund industry stood at Rs 27.26 lakh crore, registering a growth of 16 percent year-on-year.

What are SIPs?

SIP is an investment method offered by mutual funds that allows investing a fixed amount in a scheme periodically at fixed intervals - say once a month instead of making a lump-sum investment.

The SIP instalment amount could be as small as Rs 500 per month. SIP is similar to a recurring deposit where you deposit a small/fixed amount every month.

It is a very convenient method of investing in mutual funds through standing instructions to debit your bank account every month, without the hassle of having to write out a cheque each time.

SIP has been gaining popularity among Indian MF investors, as it helps in rupee cost averaging and investing in a disciplined manner without worrying about market volatility and timing the market.

SIPs help the investor average his cost over a period of time, fetching more units when prices are low and fewer units when prices are high

Generally, buying at low prices and selling at high prices in SIP works brilliantly because the volatility means you buy more units at a lesser price and hence, your ultimate returns will be very good.

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First Published on Jan 8, 2020 06:20 pm
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