Mutual Fund Outflow Touched Rs 61,809 Core in December

The overall outflow from mutual funds was a whopping Rs 61,809 crore in December 2019, which rose by Rs 7,390 crore from what it was in November 2019. The rise in outflow is despite the steady inflow via SIPs (systematic investment plans). The data was released by the Association of Mutual Funds in India (AMFI). 

The asset base has now dropped due to withdrawal of about Rs 78,426 crore from the debt-oriented schemes. However, equity funds saw an increase in the inflow in December but the overall annual inflow in the year 2019 could not beat that of the previous year’s. 

December 2019 was not a great month for debt funds as withdrawals from liquid funds alone amounted to touch Rs 71,158 crore. Liquid funds mostly invest in instruments such as certificates of deposit, treasury bills and other high-rated debt instruments. 

Also Read: When’s the Right Time to Redeem Your Mutual Fund Investments?

As per the AMFI report, equity funds are catching the investors’ attention on the back of rallying of the Indian markets of late. December 2019 saw equity funds witnessing a net inflow of Rs 4,432 crore, while it was only Rs 933 crore in November and Rs 6,015 crore in October. 

The assets under management of equity-oriented funds stood at Rs 7.71 lakh crore by the end of the year 2019. The asset base of SIP has risen to its all-time high by touching Rs 3.17 lakh crore. This indicated the positive traction being received by the equity-oriented funds. 

SIP inflow increased by Rs 245 crore to touch Rs 8,518 crore in December 2019. Currently, there are about 2.97 crore accounts through which SIPs are flowing into the mutual funds. The Indian markets are rallying ever since the Finance Minister rolled out a reduction in the corporate tax rate in August 2019. 

The asset base of mutual funds dropped 2%, it is now at Rs 26.54 lakh crore. This is mainly due to the outflow seen in the debt-oriented schemes, specifically due to liquid funds.

For any clarifications/feedback on the topic, please contact the writer at vineeth.nc@cleartax.in

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