In the first week of December 2017, L&T Emerging Businesses Fund would most likely stop accepting inflows in excess of Rs2 lakh a day. Fund manager Soumendra Nath Lahiri refused to confirm this but another senior official from the fund house said that a board meeting took place earlier this week to take a decision on this issue. L&T Asset Management Co. Ltd would not be the first instance of a fund limiting its inflows. Why do fund houses limit or stop accepting money occasionally?
The S&P BSE Sensex has returned 24% returns so far this calendar year, after returning 2% returns in 2016 and losing 5% in 2015. Equity mutual funds have returned 22% over the last 1 year period and 17% over the last 5-year period. Investors are happy and pouring over Rs5,500 crore every month through systematic investment plans (SIPs). But are fund managers happy with this?
