Mutual fund inflows declined for the fifth straight month as the number of actively managed mutual funds recorded a Rs 19,013-crore inflow during May, down by 22% as compared to the inflow of Rs 24,269.26 crore recorded in April, according to data released by the Association of Mutual Funds in India.
This indicates a five-month-long decline.
Across the board, inflows have seen a dip, as compared to April and active equity mutual funds saw a rise in assets under management to 4.85% in May at Rs 72.2 lakh crore, as compared to Rs 70 lakh crore in April.
The net inflow of the mutual fund industry was at Rs 29,108 crore, as compared to an inflow of Rs 2.76 lakh crore the previous month owing to an inflow in debt funds.
Large-cap And Midcap Inflows Dip: Large-cap funds observed an inflow of Rs 1,250 crore against Rs 2,671 crore in April. The mid-cap category also saw an inflow of Rs 2,809 crore, while the net inflows in the previous month were Rs 3,314 crore.
Small-cap Inflows Decline: Additionally, small-cap funds recorded a net inflow of Rs 3,214 crore, while the net inflows stood at Rs 4,000 crore in April.
Flexi-cap Inflows Decline: Further, flexi-cap inflows stood at Rs 3,841 crore, as compared to Rs 5,542 crore inflow in the previous month.
During times of volatility in the equity markets, retail investors should rely on Systematic Transfer Plans.
Systematic Transfer Plans (STPs) are instruments within mutual funds through which they can stagger their investments, wherein a fixed amount goes into an equity scheme from a liquid fund over 6-12 months.
STP is a method of spreading your investments over a time period to take advantage of volatility in equity markets.
The money is typically transferred from a liquid or overnight fund to an equity fund over a period of time and the frequency of transfer is decided by the investor.
STPs can help in averaging out the cost due to volatility in the stock market.
