Rs 500 crore! That's how much mutual fund investors have withdrawn over Monday and Tuesday. On Wednesday, one heard a lot of rumours about redemptions from the mutual fund basket. But in the last 48 hours, redemptions have started kicking in locally, say experts.
The withdrawal symptoms are showing, and mutual funds are feeling the pinch. Industry sources say that on Monday and Tuesday investors pulled out Rs 500 crore from equity schemes. Even so, fund houses say the redemptions are marginal.
N Sethuram Iyer, CIO, SBI MF says, "There have been some normal redemption that you have seen happening. Few investors have quit equity investments and tried to move, but that is not very significant. In fact, I would say it has been very marginal."
CIO of Cholamandalam MF, Tridib Pathak speaks on the same lines, "As an entity we have not seen much large redemptions at all. What we are advising investors is the fact that this is a correction, which was required. It is healthy and there is nothing untoward about it."
According to CNBC-TV18, mutual funds have assets of about Rs 2.6 lakh crore. Out of this, equities comprise about 40%. So far, mutual funds have been the biggest buyers in a tanking market, but if investors withdraw even more money they might turn out to be net sellers. This could have a domino effect on the market, pulling it down further. Therefore, those withdrawal symptoms are cause for concern, all right.
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