Credit-risk funds see another month of outflows but redemptions ease, inflows to equity funds fall

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Published: June 9, 2020 10:43 AM

Mutual fund investors were again seeing taking money away from the credit-risk funds that have been at the center of debate since the month of April.

Mutual funds, mutual funds investment, coronavirus pandemic, sebi, FPIs, Samco Securities,latest news on mutual fundsAmong the income/debt oriented schemes, overnight fund, medium duration fund, dynamic bond fund, credit risk fund were the schemes that saw net outflows while others saw net inflows.

Mutual fund investors were again seeing taking money away from the credit-risk funds that have been at the center of debate since the month of April. Net outflows recorded yet again in the credit-risk funds were at Rs 5,173 crore in the month of May, according to the Association of Mutual Funds in India (AFMI). With this credit-risk funds have not seen net-inflows so far this year. On the other hand, open-ended equity mutual fund schemes saw inflows worth Rs 5,256 crore, which was down 15% from the Rs 6,213 crore in inflows that the schemes received last month. 

Overall mutual funds, for the second month straight saw net inflows after seeing outflows skyrocket to Rs 2.12 lakh crore in the month of March. The net inflows for the mutual fund industry were largely aided by inflows worth Rs 61,870 crore into liquid funds and Rs 10,806 crore inflows in arbitrage funds. Amfi’s chief executive N S Venkatesh, told Financial Express Online, earlier last month that the pressure on debt mutual funds has been coming down evidently the net outflows in the month of March have now turned net inflows and even redemptions in the credit-risk funds seem to have slowed down in the month of May.

 Among the income/debt oriented schemes, overnight fund, medium duration fund, dynamic bond fund, credit risk fund were the schemes that saw net outflows while others saw net inflows, taking the total inflows from debt or income-oriented schemes to Rs 63,655 crore in the month of May. Asset Under Management (AUM) for such mutual funds increased to Rs 11.5 lakh crore from Rs 10.7 lakh crore in the previous month. Banking and PSU funds saw net inflows of Rs 8,873 crore in the month of May. Close-ended income and debt schemes saw net outflows worth Rs 9,110 crore in the period under review.

Equity oriented schemes did see net inflows for another month but the amount was seen yet again diminishing. Equity mutual funds saw net inflows of Rs Rs 5,256 crore in the open-ended schemes, down 15% from the previous month, and down a staggering 55% from the inflows witnessed in the month of March. The majority of the inflows in such schemes were registered in large-cap funds, as mutual funds rushed to the big names on Dalal Street. Dividend yield funds saw outflows worth Rs 5.98 crore. AUM of equity mutual funds dropped marginally to Rs 6.50 lakh crore from Rs 6.60 lakh crore in the previous month. 

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