NEW DELHI: The mutual fund industry has registered a total outflow of Rs 14,553 crore, with equity inflows falling for the fifth straight month in August as investors continued to flush out money from mutual funds despite the market rally.
According to data released by the Association of Mutual Funds in India (AMFI) on Wednesday, net outflow from equity-oriented schemes stood at Rs 3,999.62 crore, led by massive outflows in multi- and large-cap funds within the equity segment. Large-cap funds witnessed the highest outflows, to the tune of Rs 1,553 crore, followed by multi-cap funds at Rs 1,157 crore and mid-cap funds at Rs 602.98 crore.
“It may take one more quarter until things settle down. We have seen this in the past too. Mutual fund inflows will rebound. Currently, a reallocation is happening and by December-January funds should move back into equity,” said N Venkatesh, Chief Executive at Amfi.
Incidentally, debt-oriented schemes have also seen significant withdrawal of money in August. Debt schemes saw a net outflow of Rs 3,907.53 crore with liquid funds—used by corporates to park surplus cash—registering outflows of Rs 15,814 crore in August, followed by overnight funds at Rs 10,298 crore.
However, large positive flows in categories such as the money market fund indicate that people are moving into slightly longer duration categories to capture higher yields. Money market fund witnessed inflows of Rs 7,911.5 crore.
Similarly, investors also opted for investments in categories like ultra-short term, low duration debt fund, corporate bond, banking & PSU debt, and short-term bond funds. Inflows in these five categories stood at a total of Rs 13,648 crore. In August, redemption in equity schemes also rose to Rs 18,557.82 crore from Rs 16,622.01 crore in July.