Inflows into equity mutual funds continued for a record 18th month in October with Rs 6,269 crore (around $964 million) flowing into various schemes.besides, domestic MFs have logged in the highest net buying of $9 billion in the first 10 months of this year.
According to a Deutsche Bank research report, inflows sustained into local equity MFs for a record 18th successive month.
“This was the 18th straight month of positive flows, and a strong sign that equitisation of savings is getting entrenched despite a volatile equity market in the past few months,” Deutsche Bank said in a research note.
The global brokerage firm noted that the trend of shift from physical assets to financial assets is a multi-year phenomenon, and a lower level of inflows was likely in the near term due to volatile markets, a robust tax-free bond issuance pipeline, and an “unprecedented streak” of $20 billion in net inflows in the preceding 17 months“.
“While the pace of inflows has moderated in the past two months (as against a monthly average of $1.36 billion between January-August 2015) we still see around $800 million—$ 1 billion clip as very healthy,” it added.
Moreover, in line with the sustained inflows into equity schemes, MFs in turn have continued to be net buyers of Indian equities for the 18th straight month.
The report said, however, that the pace of net investments by MFs moderated sharply to lowest since January this year at $453 million in October this year.
From January to September, net investments by MFs reported a monthly average of $950 million.
“Cumulatively, domestic MFs have net bought $9 billion so far this year, making it the highest level of net buying by MFs on record,” the report added.
The 30-share benchmark index Sensex is currently trading around 26,000 level. The index had gained over 435 points or 1.66 per cent during October.