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Market crash: Investors prefer MFs
 
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January 30, 2008 17:08 IST

Reliance [Get Quote] Mutual Fund, the country's top fund house, on Wednesday said it acquired 100,000 new investors and received over Rs 1,000 crore (Rs 10 billion) investment in its existing funds in the last seven days, as the markets corrected.

Reliance MF equities head Madhusudan Kela said that against an investment of over Rs 1,000 crore (Rs 10 billion) received in its products, the fund house invested approximately double the amount in the markets in the last few days.

"India has not ended and bull phase is not over... investors need to rein in their expectations from return on investments in equities. On a longer term basis returns average out," Kela said. He further added that any sharp correction in the markets provide long term strategy to buy good companies at proper valuation.

Earlier on January 22, the Indian stock market tumbled by 1,408.35 points, the biggest single-day loss, shaving off over Rs 6 trillion from investors' wealth. Investors offloaded their holdings following extremely weak global cues on increased fears of imminent recession in the US as well as a wave of selling by FIIs.

This plunge was triggered by concerns in the global investor community about a recession in US, the world's largest economy. Though the global interest rates dip is a reality, in the long term perspective "rupee would appreciate, (which is) imperative to reduce interest rate in India to adjust with global scenario," Kela said.

The assets under management of Reliance MF stood at Rs 80,779 crore (Rs 807.79 billion) at the end of December 2007, while the total assets of all the 32 funds in the country aggregates to Rs 5,49,942.02 crore.


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