Redemption from equity schemes of mutual funds increased in October. Investors sold equity funds worth Rs 2,724 crore in October, compared to Rs 734 crore in September. Hybrid schemes – mutual fund schemes that invest in a mix of stocks, bonds and gold in varied proportions - saw net redemptions of Rs 1,681 crore. This was relatively less than net redemptions of Rs 4,219 crore reported in September.
During October, mutual fund systematic investment plans (SIP) accounts grew to 3.37 crore, compared to 3.34 crore in September. The monthly SIP contribution for October is registered at Rs 7,800 crore marginally above the September inflows of Rs 7,788 crore. Increase in SIP numbers is a sign of investors opting for staggered investments in mutual funds.
As per the monthly data released by the Association of Mutual Funds in India (AMFI), total assets under management for the mutual fund industry stood at Rs 28.22 lakh crore as on October 31, as compared to Rs 26.85 lakh crore as on September 30.
Bond funds saw net inflows of Rs 1.1 lakh crore. Corporate bond funds recorded prominent net inflows of Rs 15,051 crore in October, compared to Rs 716 crore in September. This clearly indicates investors’ preference for schemes investing in high quality bonds.
Thematic or sectoral funds saw positive net inflows of Rs 2,214 crore in October. Among equity funds, multicap funds saw maximum outflows to the tune of Rs 1,902 crore.
Last week, Securities Exchange Board of India (SEBI) announced a new category of equity mutual funds – ‘flexicap.’The move would allow fund managers to shuffle their allocations freely across small, mid and large-cap stocks, without any minimum limits. This should do away the anxiety of investors in multi-cap investors as it allows the fund houses to move their multicap funds to the flexicap category to invest in stocks of companies of all sizes without any restriction.