After starting the financial year on a good note, the AUM of the mutual fund industry in the month of May slipped to Rs.19.04 lakh crore from Rs.19.26 lakh crore, shows the latest AMFI data.
The AUM fell marginally 1.15% from Rs.19.26 lakh crore in April, mainly due to the net outflows in liquid funds.
“There has been just a slight decrease in AUM which is acceptable. As it is the beginning of the financial year, institutions must have redeemed their investments to undertake various projects. However, there have been no outflows from the long-term investments such as equity-oriented funds,” says Vidya Bala, Head of MF research at FundsIndia.
Happily, assets under equity-oriented funds continue to grow. In fact, assets under equity funds increased the highest in the month. Assets increased by Rs.13,394 crore to Rs.5.18 lakh crore in May. Experts say that the rising market is helping the industry attract investors. The increase in the net inflows in equity funds has also led to an increase in assets. Sensex gained 4.1 % in May.
“Investors have confidence in the market. This is evident from the fact that more retail investors are staying invested for a longer period. Moreover, every month new investors are entering the mutual fund industry. On the other hand, fund houses are working to build their SIP books. The popularity of SIP among retail investors is helping assets under equity funds grow,” says G. Pradeepkumar, CEO of Union Mutual Fund.
Equity funds received a net inflow of Rs.10,208 crore, and more than 6.5 lakh equity folios were added in May.
Overall the assets under all equity funds which includes pure equity funds, balanced, ELSS, equity ETFs were at Rs.7.3 lakh crore. It witnessed a 3.5% growth in assets led by strong inflows and mark to market gains.
In terms of percentage, balanced funds saw the highest increase in assets. Assets under the category increased by 9.2% to Rs.1.02 lakh crore in May. Experts say that new investors are going to balanced funds as they want to start investing with moderate equity allocation.
All categories except gold ETF and liquid funds witnessed increase in assets.
Overall, the mutual fund industry saw net outflows of Rs.40,711 crore in May.
Change in monthly AUM
|
Category |
May AUM in Rs Crore |
April AUM in Rs Crore |
Change |
Change in % |
|
Equity |
5,18,365 |
5,04,971 |
13,394 |
2.6% |
|
ELSS |
65,192 |
63,799 |
1,393 |
2.2% |
|
Balanced |
1,02,156 |
93,530 |
8,626 |
9.2% |
|
ETFs other |
47,584 |
45,899 |
1,685 |
3.6% |
|
ETFs gold |
5,298 |
5,377 |
-79 |
-1.5% |
|
Income |
7,92,734 |
7,80,797 |
11,937 |
1.5% |
|
Gilt |
14,595 |
14,356 |
239 |
1.6% |
|
Liquid |
3,54,202 |
4,13,746 |
-59,544 |
-14.4% |
|
FOFs investing overseas |
1,709 |
1,705 |
4 |
0.2% |
|
Total |
19,03,975 |
19,26,302 |
-22,327 |
-1.15% |
Source: AMFI
