In a sign of retail investors taking a long-term view of the markets, equity schemes of mutual funds have seen a net inflow of around Rs 3,000 crore in the last six months, at a time when the benchmark BSE Sensex fell around 17%.
Retail investors have invested Rs 4,900 crore, while withdrawing Rs 1,800 crore during April-September 2011, reflecting a net inflow of Rs 3,100 crore, data available with the Association of Mutual Funds in India (AMFI) showed.
“This (net inflow) suggests that unlike the last few years when they succumbed to panic and nervous selling, investors today are more matured and smart in their approach while investing in equity and equity-related investments,” said Ashu Suyash, country head and managing director, Fidelity Worldwide Investment.
The Sensex has been on a downslide on concerns of a global economic slowdown triggered by the European debt crisis.
One of the main reasons for the strong inflow is the culture of investing regularly through systematic investment plans (SIPs) by retail investors, experts said.
“Despite the volatility in stock market, we have seen fresh SIPs coming throughout the year, which shows Indian investors have long-term vision for investment,” said Arindam Ghosh, vice-president and head, retail sales, JPMorgan Asset Management. “SIPs have become very important part of Indian mutual fund industry.”
According to the market estimates, around Rs 1,000 crore is invested through SIPs per month. Experts believe that going forward, the Indian mutual fund industry will continue to witness strong inflow from investors despite volatility.