December 10: Equity mutual fund (MF) schemes recorded worst inflows in three and a half years at Rs 1,311 crore for November. It was 78 per cent low compared to the preceding month.
Despite the drop in equity inflows, the assets under management (AUM) for the industry soared to a record high of Rs 27 trillion due to over Rs 50,000 crore of net inflows in debt schemes. In November, equity schemes saw Rs 16,268 crore of redemption, 47 per cent higher than the previous month.
In the past three months, the benchmark Sensex has gained more than 8 per cent, hitting an all-time high of 41,163 points on November 28. In June 2016, equity flows had slipped to Rs 320 crore, posting a month-on-month decline of 93 per cent.
This was also a period when markets had registered a strong recovery, gaining over 20 per cent in the past four months.
Contribution through systematic investment plans (SIPs) - that is, monthly commitment made by investors - grew marginally to Rs 8,272 crore in November. Industry experts said SIPs had stayed intact, which is a healthy sign for the MF industry.
As against SIPs, lump sum money is tactically deployed by investors when the markets are trading at attractive level.