Weak equity markets and the fear of further economic slowdown following global uncertainty have forced retail investors to redeem equity mutual funds units in the first half of the current financial year. According to data from the Association of Mutual Funds in India (Amfi), over 5.8 lakh folios moved away from the industry during the six month period ending September.
While equity, gilt and balanced schemes saw a fall in folios, all other categories such as liquid schemes, ETFs other than gold and fund of fund investing overseas saw investors coming in, during the period March to September. In September, total folios for the mutual fund industry stood at over 4.71 crore; a fall of over 62,400 as against March when total folios were approximately 4.72 crore
Vikaas Sachdeva, CEO at Edelweiss MF says, ?Its a healthy sign that investors have started coming into debt funds. We believe that over a period of time money will eventually flow into equity or balanced schemes.?
The Amfi data also showed that most retail investors in equity mutual funds are holding for more than two years. Over 62% of retail investors remained invested in equity funds for over two years during the half year ended September.
A sales head from a leading fund house said, ?it is very positive for the industry that retail investors are taking a view of over two years while investing in mutual funds. However we are generally asking investors to take view of atleast five years, so that they could be assured of healthy returns.?
