Home >Mutual Funds >News >Equity AUM rises 21% to 7 trillion on rebound in mkts, SIP inflow: Report
Photo: iStock (iStock)
Photo: iStock (iStock)

Equity AUM rises 21% to 7 trillion on rebound in mkts, SIP inflow: Report

Inflows during the quarter declined sharply to 11,710 crore compared to 30,703 crore in the January-March 2020 period, primarily due to increased redemptions in June as investors booked profits

NEW DELHI : The asset base of equity mutual funds surged 21% to over 7 trillion during the June 2020 quarter, primarily on account of rebound in markets and backed by strong SIP inflows, a Morningstar India report said on Thursday.

However, inflows during the quarter declined sharply to 11,710 crore compared to 30,703 crore in the January-March 2020 period, primarily due to increased redemptions in June as investors booked profits.

Of 11,710 crore investment in the June 2020 quarter, the schemes attracted 6,213 crore in April, 5,256 crore in May and 240.55 crore in June, which was the lowest investment level in four years.

"Tepid investor sentiment along with profit booking has led to a decline in net inflows since April," the report noted.

It further said few top-performing funds continue to draw bulk of the inflows, particularly funds in the large-cap focused and multi-cap categories, while under-performing funds witnessed outflows.

The asset base of equity mutual funds rose 21.2 per cent to 7.01 lakh crore by June-end from 5.78 lakh crore at the end of March.

According to Morningstar, equity AUM rose as a result of rebound in markets, backed by strong monthly SIP (Systematic Investment Plan) flows, which averaged 8,139 crore in the second quarter of the calendar year 2020.

Investors prefers SIP as it helps them in rupee cost averaging and also in investing in a disciplined manner without worrying about market volatility and timing the market.

The overall industry's assets under management (AUM) rose 14.5% to 25.49 trillion in the quarter ended June from 22.26 trillion at the end of March quarter.

The 45-player mutual fund industry witnessed over 1.24 trillion inflow across the schemes in the June quarter.

Of the total inflow, banking and PSU funds witnessed an inflow of 20,912 crore, while the same for corporate bond funds was 18,738 crore as the flight to safer assets continued.

In addition, investors put in 20,930 crore in arbitrage funds.

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