The growing interest in smallcap stocks by mutual funds (MFs) must be considered in light of the associated liquidity risks, cautioned Ananth Narayan, whole-time member (WTM) of the Securities and Exchange Board of India (Sebi).
The remarks from the Sebi official come at a time when net inflows into smallcap equity funds for the quarter ending in September have topped Rs 11,000 crore. However, inflows in September have dropped by 37 per cent month-on-month to Rs 2,678 crore.
