Equity-oriented mutual funds witnessed net outflows for the fourth month in a row, shows data released by Mutual Fund (MF) Industry body, Association of Mutual Funds in India (AMFI) on November 9, 2020. Except for categories like large and mid cap funds and sectoral/ thematic funds, all the open-ended equity schemes saw an outflow in the month of October 2020.
The overall open-ended equity schemes outflow was worth Rs 2,724.95 crore. The multi cap funds saw an outflow of Rs 1,902.74 crore, while large cap funds witnessed an outflow of Rs 550.87. The mid and small cap funds saw an outflow of Rs 555.53 crore and Rs 484.09 crore.
“Multi cap category continued to witness net outflow for the fifth month in a row and was the worst hit, followed by value fund / contra fund category. The net outflows in October could be largely attributed to profit booking by investors on the back of a surge in equity markets,” says Himanshu Srivastava, Associate Director – Manager Research, Morningstar India.
On the debt side, there was a surge in the net flows in debt schemes during October 2020 as compared to September 2020. The increase in inflows was led by liquid, money market, corporate bond fund, short duration, ultra short duration, low duration and banking and PSU fund categories.
When it comes to the hybrid scheme category the outflow was significantly moderated at Rs 1,681.87 crore for October 2020, as compared to Rs 4,219.01 in September 2020 and Rs 4,819.45 crore for August 2020. On the positive side the Gold Exchange Traded Funds (ETFs) and Fund-of-Fund (F-o-F) categories continued to witness net inflows of Rs 384.21 crore and Rs 337.96 crore during the month.
The total Mutual Fund Asset Under Management (AUM) was on October 31, 2020 to highest ever Rs 28.22 lakh crore while average AUM for October 2020 was Rs 28.33 lakh crore. During October 2020, MF Systematic Investment Plans (SIPs) grew to 3.37 crore, leading to a rise in monthly contribution of Rs 7,800 crore, compared to Rs 7,788.37 crore in September 30, 2020. “Rise in both SIP contribution and SIP AUMs during October 2020 and continued slowing outflow in equity schemes reinforce the retail investor confidence in mutual funds as an asset class,’’ says NS Venkatesh, CEO, AMFI.