Indian Equity Mutual Funds See Sharp Inflows Decline in May Amid Geopolitical Tensions
Equity mutual fund inflows in India fell 40% to Rs 22,908 crore in May, the lowest in a year, driven by geopolitical tensions in West Asia, rising crude oil prices, and market volatility. The broader mutual fund industry recorded net outflows of Rs 64,000 crore in May, primarily due to heavy withdrawals from debt schemes. Systematic Investment Plan (SIP) contributions remained relatively stable, providing a cushion against broader market weakness.
India's equity mutual funds experienced a significant slowdown in May 2024, with net inflows dropping 40% from April to Rs 22,908 crore, marking the weakest monthly performance in a year. The decline was attributed to multiple factors including Iran-related geopolitical tensions, crude oil prices hovering near $100 per barrel, and overall market volatility that prompted cautious investor positioning. While equity inflows weakened across all segments—with Flexi Cap funds leading at Rs 5,175 crore—Systematic Investment Plan (SIP) contributions remained relatively stable at Rs 30,954 crore, demonstrating continued retail participation through disciplined investing. The broader mutual fund industry faced net outflows of Rs 64,000 crore in May, primarily driven by Rs 96,948 crore in withdrawals from debt-oriented schemes, causing total industry AUM to decline slightly to Rs 81.6 lakh crore. According to AMFI leadership, the moderation reflects global uncertainty and commodity price volatility, with investors adopting a wait-and-watch approach, particularly in riskier equity segments.
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- Times of IndiaCenter
Markets shake, money slows: Equity mutual funds see sharp dip in inflows
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