Mutual fund investors are buying again

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Chirag Madia: Jan 18 2011, 01:16 IST

After several months of outflows from equity schemes, the month of December 2010 witnessed positive inflows. Mutual funds are seen acting as a partial counterbalance to massive FII selling during the year. In an interview with Chirag Madia, MD and country head, Fidelity Investment Managers, Ashu Suyash, says mutual fund investors are back to investing into equity market with the market correcting and being led by strong distribution push.

After months of redemption pressures, December saw a reversal of trend with inflows being witnessed into the equity schemes?

Before December, not only equity funds but also IPOs had not received major investor response. Investors have not yet forgotten the 2008 bear market which is making them wary of investments. And as it happens always, it took a while to return to markets. Whenever investors are sitting on the fence, every market dip is looked as a buying opportunity and this is what happened in December '10.

Besides, several distributors has also started selling mutual funds once again which is impacting inflows positively. I think the first quarter of the new year might witness inflows into the equity schemes.

We have seen a correction in the equity markets, how do you think markets are likely to shape up in the months to come?

This year has started on a volatile note. However, we strongly believe that fundamental growth drivers are intact. We have seen lot of concerns arise out of inflation and political uncertainty. Until these issues are dealt

... contd.

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