Mumbai: Even though markets fared well in November, inflows into equity mutual fund schemes fell during the period. According to Association of Mutual Funds of India (AMFI) data, net inflows into domestic equity mutual funds fell 33.33% to 8,414 crore in November from the previous month, the lowest since August. The Sensex rallied 5.09% during the same period, while domestic institutional investors (DIIs) bought Indian shares worth 800.3 crore in November, much lower from 26,033 crore in October.

According to AMFI chief executive N.S. Venkatesh, volatility in the capital markets is the main reason for the fall in inflows.

“Markets remained volatile since investors were nervous ahead of the results of the state elections. They preferred to remain on the sidelines," he added.

Volatility increased in the Indian market due to uncertainty in oil prices, anxiety ahead of the state elections and global risks arising out of the US-China trade dispute. Crude oil prices fell around 28% from October to date, slipping 20.78% in November. High crude prices weighed on markets in 2018 as valuations became steep and much-awaited company earnings took longer than estimated.

However, Venkatesh sees the industry growing by 20% and assets under management (AUM) at 30 lakh crore by the end of 2019. “With India becoming the fastest growing economy and inflation rates slowing down, equities are expected to perform better in the near future. We are hopeful that from next year, many more investors will choose mutual funds as their preferred option to grow their wealth."

According to Amfi data, total amount collected through systematic investment plans (SIPs) in November was 7,985 crore, the same as last month.

Redemption pressures from mutual fund equity schemes also eased in November to 7,200 crore, from 10,183 crore a month ago.

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