Equity flows see sharpest dip in 3.5 years, slip 78% in November

Flows were 78% low compared to Oct; lump sum investments hit

Equity mutual fund (MF) schemes recorded worst inflows in three and a half years at Rs 1,311 crore for November. It was 78 per cent low compared to the preceding month. Despite the drop in equity inflows, the assets under management (AUM) for the industry soared to a record high of Rs 27 trillion, thanks to over Rs 50,000 crore of net inflows in debt schemes. In November, equity schemes saw Rs 16,268 crore of redemption — 47 per cent higher than the previous month.

“Investors have been nervous and current conditions have not given much comfort. Some investors may have opted to take out money with the recent rally bringing in some relief,” said Swarup Mohanty, chief executive officer at Mirae Asset Management Company (AMC). In November, equity schemes saw Rs 16,268 crore of redemption, 47 per cent higher than the previous month.

“Investors across the board have taken money off the table as markets have scaled new highs. Even in the current month, the redemptions have stayed on the higher side,” said the chief executive of a fund house, requesting anonymity. In the past three months, the benchmark Sensex has gained more than 8 per cent, hitting an all-time high of 41,163 points on November 28.

In June 2016, equity flows had slipped to Rs 320 crore, posting a month-on-month decline of 93 per cent. This was also a period when markets had registered a strong recovery, gaining over 20 per cent in the past four months.