NEW DELHI: Retail investors are riding the equity market bull-run, and it seems they are doing so with the help of mutual funds. Data released by industry body - Association of Mutual Funds in India (AMFI) -- shows that monthly investments in mutual funds through Systematic Investment Plan (SIP) reached Rs 10,351 crore in September.
This is the first time the monthly SIP contribution breached Rs 10,000-crore mark. Total asset under management (AUM) collected through SIPs has reached Rs 5.45 lakh crore, which is almost a third of the total retail AUMs of Rs 17.72 lakh crore. The industry asset under management (AUM) at the end of September reached Rs 36.74 lakh crore.
In September, 26.80 lakh new SIP accounts were registered taking the total SIP accounts to 4.5 crores. A year ago, SIP accounts stood at 3.34 crore.
NS Venkatesh, Chief Executive, AMFI, said: “Mutual Fund monthly SIP contribution breaching Rs 10,000 crore milestone for the first time ever and industry AUMs touching all-time high at Rs 36.73 lakh crore is historic, and is reflective of continued retail investor confidence in the mutual funds.”
He attributed this rise in SIP to retail investors preferring mutual funds over low-yielding traditional savings avenues like bank FDs, and also gold and real estate.
Category-wise, equity and equity-oriented mutual funds saw a net inflow of Rs 8,677 crore, index funds saw a net inflow of Rs 11,600 crore and hybrid schemes saw a net inflow of Rs 3,600 crore. However, debt funds witnessed a massive net outflow of Rs 64,000 crore during the month. This resulted in an overall net outflow of Rs 47,250 crore in September.
Aashwin Dugal, Co-chief business officer, Nippon India Mutual Fund, says that the net outflows in the industry led by debt category were partly due to a section of institutional investors who exit MFs at the end of every quarter. According to him, a few institutional investors might have redeemed from short to medium debt funds ahead of RBI’s Monetary Policy announcements. He, however, feels that these flows are expected to come back over the course of the quarter once bond markets get a direction post policy announcement.