Net inflow in equity-oriented schemes was the lowest in November since April 2021, but SIP numbers were still strong at 21,77,629 new additions.
The number of retail mutual fund folios reached an all-time high of 11,17,60,343 in November 2022, while the contribution from systematic investment plans (SIP) totaled Rs 13,306,49 crore in the month, the industry body the Association of Mutual Funds in India (AMFI) said.
The net inflow of equity-oriented mutual funds dropped significantly to Rs 2,224 crore in November, the lowest monthly inflow since April 2021.
In October, the inflow of equity mutual funds was Rs 9,253 crore.
Investing Trends In November
The mutual fund industry's net asset under management (AUM) was Rs 40,37,560.81 crore in November 2022. Retail AUMs (Equity, Hybrid, and Solution-Oriented Schemes) stood at Rs 20,91,586 crore.
The SIP accounts stood at 60,457,429 compared to 59,330,069 in October. The AMFI data also showed that SIP AUM rose to Rs 6,83,851.8 crore in November from Rs 6,64,780.86 crore in October. A total of 21,77,629 new SIPs were registered in November 2022.
Manish Maryada, co-founder & CEO of Fello, a game-based saving and investing platform, said, "Despite the economic uncertainties, India has been witnessing an all-time high in the stock market, and the recent trends of Nifty and Sensex records speak for it."
He added, "From Nov 2020 to Nov 2021, a massive 50 per cent increase in AUM for equity funds has been witnessed, but if you notice the growth from Nov 2021 to Nov 2022, it grew by 21 per cent."
"Based on our consumer feedback and primary market research, we noticed that retail investors became repellent to savings and investments during the pandemic and chose the equities market, especially mutual funds, and invested without any primary research," Maryada added.
Gold ETF AUM Grows
In November, the AUM of gold exchange-traded funds (ETF) was Rs 20,832.77 crore. “AUM under Gold ETF grew by 37 per cent from Nov 20-21 and 15 per cent from Nov 21-22. Though the growth is significant, there are several reasons why the growth percentage hasn’t been similar to the previous year,” said Maryada.
Multicap & Index Funds Show Growth
According to AMFI, sectoral or thematic funds recorded the highest inflow at Rs 1,379.68 crore. On the other hand, small-cap mutual funds witnessed the second-highest monthly influx at Rs 1,378.24 crore.
N.S. Venkatesh, chief executive at AMFI, said, “Rate hikes will continue to impact global markets but not for long, irrespective of whether the mutual fund industry has performed well. There have been outflows from the retail schemes as people are encashing profits.”
“We have seen encouraging growth in many schemes, especially Index schemes. We believe the upcoming budget will bring cheer to the market, which will clear the pathway to more inflows in various schemes; debt schemes will stabilise once the RBI rate hikes stabilise. However, mutual fund investors have shown resilience and continue to invest in SIPs,” Venkatesh added.