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Guru Gyan

MF Data Snapshot: MFs record highest ever AUM; Debt funds see robust inflows

The assets under management (AUM) of the mutual fund industry surged to highest-ever at ₹28.22 lakh crore in October-end from ₹26.85 lakh crore recorded in September-end. The overall net inflows of nearly ₹98,575.96 crore across all segments in October, supported majorly by the robust inflows recorded in Debt funds, helped the AUM of the industry rise during the month under review.

The growth and equity-oriented schemes registered a net outflow of ₹2,724.9 crore in October as compared to ₹734.4 crore outflows in the previous month, as per the monthly data released by the Association of Mutual Funds of India (AMFI).

Multicap funds witnessed the biggest outflow of ₹1,902.4 crore during the month, followed by Value/Contra fund with ₹1,201 crore outflows. Sectoral/Thematic funds were the only scheme under the equity category to have recorded positive flows at ₹2,214.6 crore. The tax-saving Equity-Linked Savings Scheme (ELSS) continued to record a net outflow for the second consecutive month at ₹274.4 crore from last month’s ₹38.8 crore outflow.

The chart below shows the equity flows of three months i.e., August (₹-3,999.6 crore), September (₹734.4 crore) and October (₹2,724.9 crore). The equity-oriented mutual funds witnessed net outflows for the fourth straight month.

The income and debt-oriented schemes supported the overall AUM of the mutual fund industry by recording a sharp increase in inflows in October as bond yields have been in the decline mode. The net inflows of the scheme stood at ₹1,10,466 crore against outflow of ₹51,962 crore in September. Liquid fund pushed the scheme overall as it garnered net inflows of ₹19,582.7 crore during the month in focus.

Ultra-short duration funds, Money market funds, Short Duration funds, Corporate Bond funds also garnered huge inflows in October. However, Credit Risk Fund continued the outflows trend as it saw ₹414.8 crore of negative flows.

Coming to the Hybrid schemes (mix of equity and debt), the scheme’s outflow in October came at ₹1,681.8 crore, better than compared to September’s outflow of ₹4,219 crore. The scheme was dragged by redemptions in Balanced Hybrid fund, but supported by ₹1,739 crore inflows in Arbitrage Fund.

After registering the inflows of nearly ₹597 crore in August, Gold exchange-traded funds (ETF) inflows slipped for the third straight month to ₹384 crore in October. Index funds garnered just ₹61.4 crore worth inflows versus ₹397.7 crore net inflows last month.

The chart depicts the total contribution made by systematic investment plans (SIPs) in the last six months. In October 2020, the SIP inflows rose slightly to ₹7,800 crore as compared to ₹7,788.4 crore in September 2020.

“Rise in both SIP contribution and SIP AUMs during October 2020 and continued slowing outflow in equity schemes reinforces the retail investor confidence in mutual funds as an asset class,” said NS Venkatesh, chief executive at AMFI on the AUM data.

The assets under management (AUM) from SIPs rose by ₹6,446 crore to ₹3.42 lakh crore. The total number of SIP folios saw a marginal jump to 3.37 crore during the month from 3.33 crore month-on-month (MoM).

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