Taking credit risks in shorter-tenure funds can help jack up returns considerably, boosting sales.
If you are a retail investor, you can allocate a portion of the portfolio to the medium- to long-term debt fund category instead of gilt funds.
After three consecutive years of infusing huge funds, foreign portfolio investors retreated from the Indian equity markets in a big way in 2022 with the highest-ever yearly net outflow of nearly Rs 1.21 lakh crore. The huge outflow, which surpasses by a big margin the previous record of Rs 53,000 crore net withdrawal in 2008, came amid aggressive rate hikes by central banks globally but 2023 is expected to be better on positivity about overall macroeconomic trends in India, experts said. Apart from global monetary tightening, volatile crude, rising commodity prices along with Russia and Ukraine conflict led to an exodus of foreign money in 2022.
Experts believe FPIs will keep a close watch on coronavirus pandemic, its spread and likely impact on the economy while making decisions about investment into India.
'Investors need to understand that these schemes may not do well in the market that is in a bull run, but quality stocks would protect the downside.'
Experts attributed the inflows to sudden rally in gold prices, mainly due to uneasy trade negotiations between the US and China and lower than expected global GDP growth.
Equity flows have been under pressure since the second half of 2018, after the IL&FS crisis sent shockwaves in both equity and debt markets.
Continuing their massive selling spree for the ninth consecutive month, foreign investors dumped Indian shares worth Rs 50,203 crore in June -- the highest net outflow in over two years -- amid aggressive rate hike by the US Federal Reserve, elevated inflation and relatively higher valuation of domestic equities. Foreign portfolio investors (FPIs) have now pulled out around Rs 2.2 lakh crore from domestic equities in the first six months of 2022 -- the highest-ever net withdrawal by them. Before that, FPIs withdrew Rs 52,987 crore in the entire 2008, data with depositories showed.
Don't exit from growth-style funds as they may benefit next from a shift in investor preference.
This is aimed at improving liquidity in all schemes and would help them to meet sudden redemption pressures, said Sebi chairman Ajay Tyagi.
Investors continue to back-up equity mutual funds in June as such schemes attracted a net inflow of Rs 15,498 crore on strong flows from systematic investment plans despite volatility in the stock market and relentless selling by Foreign Portfolio Investors (FPIs). This also marked the 16th straight month of positive inflow in equity schemes. Inflows into equity mutual funds in June was lower compared to the net inflow of Rs 18,529 crore seen in May, data from the Association of Mutual Funds in India (AMFI) showed on Friday.
Driven by inflows into Systematic Investment Plans (SIPs), the mutual fund industry's total assets under management rose to Rs 39.88 lakh crore in September from Rs 36.73 lakh crore in the year-ago period. On a monthly basis, the Assets Under Management (AUM) increased marginally from Rs 39.33 lakh crore in August. According to the latest monthly data from the Association of Mutual Funds in India (Amfi) released on Monday, the industry wide net AUM stood at Rs 38.42 lakh crore in September.
Overseas investors had put in a net sum of Rs 45,981 crore in March and Rs 11,182 crore in February in the capital markets
'Continue with your SIPs to get the benefit of lower average prices in this challenging market environment.'
As emotional beings, humans tend to be their own worst enemy when it comes to making investment decisions, says Holly Cook
Equity MF schemes recorded worst inflows in three and a half years at Rs 1,311 crore for November. Investors across the board have taken money off the table as markets have scaled new highs. Industry experts said SIPs had stayed intact, which is a healthy sign for the MF industry.
So unless you are convinced of getting your market timing absolutely bang on everytime, opting for SIPs is more realistic from a logistical and psychological standpoint, says Larissa Fernand
Foreign investors have pulled over Rs 6,400 crore from the Indian equity market in the first four trading sessions of the ongoing month when the Reserve Bank of India (RBI) and US Federal Reserve raised interest rates. Given the headwinds in terms of elevated crude prices, inflation, tight monetary policy among others, FPIs' flows in India are expected to remain volatile in the near term, Shrikant Chouhan, Head - Equity Research (Retail), Kotak Securities, said. Foreign Portfolio Investors (FPIs) remained net sellers for seven months to April 2022, withdrawing a massive amount of over Rs 1.65 lakh crore from equities. This was largely on the back of anticipation of a rate hike by the US Federal Reserve and due to the deteriorating geopolitical environment following Russia's invasion of Ukraine.
Gold exchange traded funds (ETFs) witnessed a net outflow of Rs 248 crore in February, making it the second consecutive month of withdrawals as investors preferred equities over other segments on record SIP flows. Net outflows from the gold ETFs were at Rs 452 crore in the month of January. Prior to that, the asset class had seen a net investment of Rs 313 crore, according to the data of Association of Mutual Funds in India (Amfi). Despite the outflows, the category witnessed an increase in net assets under management (AUM) of gold ETFs to Rs 18,727 crore at the end of February from Rs 17,839 crore in January-end.
Better stick to equity diversified funds, says Larisssa Fernand
Foreign portfolio investors (FPIs) pulled out as much as Rs 17,537 crore from the Indian markets in just three trading sessions of March as investors' sentiment got dented by the uncertainty triggered by the Russia-Ukraine conflict and rising crude oil prices. As per depositories data, they pulled out Rs 14,721 crore from equities, Rs 2,808 crore from debt segment and Rs 9 crore from hybrid instruments between March 2-4. This took the total net outflow to Rs 17,537 crore.
Foreign portfolio investors (FPIs) have pulled out Rs 17,696 crore from the Indian markets in December so far amid uncertainty due to a new coronavirus strain, Omicron, and expectations of faster tapering by the US Federal Reserve. According to the depositories data, FPIs took out Rs 13,470 crore from equities, Rs 4,066 crore from the debt segment and Rs 160 crore from hybrid instruments between December 1-17. In November, FPIs were net sellers to the tune of Rs 2,521 crore in Indian markets.
Before you rush to invest in these funds, understand the risks they carry and whether you have the appetite for them, says Sanjay Kumar Singh.
The number of equity schemes rose to 562 from 519 two years ago. Equity NFOs, in fact, have mopped up more than Rs 16,000 crore since 2018 - 2.7 times the Rs 5,948 crore collected in the preceding three calendar years.
Equity mutual funds attracted an all-time high net inflow of Rs 28,463 crore in March, on continued interest by retail and HNI investors, who used market correction as a good buying opportunity.
Mutual funds focused on investing in fixed-income securities witnessed a heavy outflow of Rs 92,248 crore in June on uncertain macro environment, driven by expectations around an increasing rate cycle, higher commodity prices and slowdown in growth. This comes following a net outflow of Rs 32,722 crore in May and an inflow of Rs 54,756 crore in April, data available with Association of Mutual Funds in India (Amfi) showed. Out of the 16 fixed-income or debt fund categories, 14 witnessed net outflows during the month under review.
One risk of investing in a very low-cost ETF is if a fund house runs it at below cost, it could close it if it fails to attract institutional money
Importantly, is there hope going forward?
Only if you are a conservative investor satisfied with index returns; but over long term actively managed funds give better returns in Indian markets
These are the top 8 out of 88 funds that the diversified equity fund category has to offer.
Sustaining positive momentum for the 14th straight month, equity mutual funds attracted a net sum of Rs 15,890 crore in April amid heightened volatility in stock market and consistent selling by foreign portfolio investors. This was much lower compared to a record net inflow of Rs 28,463 crore seen in the preceding month, data from the Association of Mutual Funds in India (AMFI) showed on Tuesday. The lower quantum of net inflow from the previous month could be attributed to investors going slightly cautious given the ongoing challenges to the investment environment, Himanshu Srivastava, associate director - manager research, Morningstar India, said.
The value of foreign portfolio investors' (FPI) holdings in domestic equities reached $654 billion in three months ended December 2021, a drop of nearly 2 per cent from the preceding quarter, according to a Morningstar report. This was largely on the back of a massive sell-off by foreign investors and a correction in the Indian equity markets, especially in the large and mid-cap sectors. "At the end of the quarter ended December 2021, the value of FPI investments in Indian equities fell to $654 billion, which was lower than $667 billion recorded in the previous quarter, a fall of around 2 per cent," the report noted.
Here are five red flags that should prompt you to look beyond a mutual fund's five-star rating.
MFs have garnered record assets in the past one year, led by increased investor participation through SIPs and robust returns in mid-cap schemes.
The value of the foreign portfolio investors' (FPI) holdings in the domestic equities reached $667 billion in three months ended September 2021, a surge of 13 per cent from the preceding quarter, according to a Morningstar report. This was largely on the back of strong performance by the Indian equity markets along with net inflows from FPIs at the later part of the quarter. "At the end of the quarter ended September 2021, the value of FPI investments in Indian equities shot up sharply to $667 billion, which was considerably higher than the $592 billion recorded in the previous quarter, a spike of around 13 per cent," the report noted.
Overseas investors have pumped in $6.3 billion in Indian equity markets in three months ended September on attractive valuations, opening-up of the economy and resumption in business activities, says a Morningstar report. This comes following a net inflow of $3.9 billion in June quarter and a net withdrawal of $6.38 billion in March quarter. Apart from inflow, the value of FPI investments in Indian equities swelled further during the quarter under review largely on the back of robust net inflows, coupled with a strong performance of the Indian equity markets.
Foreign portfolio investors (FPIs) remained net buyers to the tune of Rs 12,266 crore in the Indian market in the first five trading sessions of February, as positive sentiment post-Union Budget 2021 sparked a rally in investment.
One fear among regulators is that allowing side pocketing could lead to fund managers taking higher risks. Even in the US, side pocketing is not allowed in mutual funds, only in hedge funds
Undeterred by the stock market volatility, uncertainty due to the Ukraine-Russia war and high inflation, equity mutual funds continue to remain attractive choice for investors for the 15th straight month, registering a net inflow of Rs 18,529 crore in May on robust SIP numbers. This was higher than Rs 15,890 crore net inflow in April, data from the Association of Mutual Funds in India (AMFI) showed on Thursday. Equity schemes have been witnessing net inflow since March 2021, highlighting the positive sentiment among investors.
Arbitrage schemes can give investors better post-tax returns than debt funds.
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