Investors continued to enter the Indian mutual fund industry despite volatility in the domestic equity markets. The latest data from the Securities and Exchange Board of India (Sebi) show the industry added 6.02 lakh new folios in September.
Market participants say rise in folios can be attributed to strong performance of equity funds in the past few months.
The data from Sebi also show that equity mutual funds added 4.66 lakh folios in equity-oriented schemes in September.
Total folios of equity-oriented schemes stood at 3.38 crore in September, while the figure was 4.44 crore for the overall mutual fund industry.
G Pradeepkumar, chief executive officer at Union KBC Asset Management Company, said, “In the last few months, we have seen investors have put in more money into equity funds when markets have turned red. I think it’s very mature move as earlier they used to enter during high markets and move out when they were down.”
Even the numbers shows that investors have not been dismayed by inconsistent equity markets and there has been consistent rise in systematic investment plans (SIPs), market players said. Equity mutual funds continued their positive momentum and saw net inflows of R5,014 crore in September. According to the data from the Association of Mutual Funds in India (Amfi), mutual fund industry saw net outflows of R77,142 crore in September due to redemption into debt funds. Apart from equity funds, equity-linked saving schemes (ELSS) witnessed inflows of R430 crore in September. In the current financial year, equity funds have seen flows of R51,000 crore.
Market participants also say in spite of average performance of the equity markets, mutual funds have been able to deliver better returns and attract new investors. “It’s quite surprising that there has been rise in equity assets and folios. Though flows into equity funds have slowed down in September compared to the first five months of the current financial year, we assume that there is more money to come in at every dip,” said a CEO of a top fund house.