The net flow of Domestic Mutual Funds into the equity markets crossed Rs 1-lakh crore mark during calendar year 2017 (CY17). Following the ample liquidity in the market, S&P BSE Sensex and the Nifty 50 have improved by 23.7% and 24.4% so far in 2017 (CY17). In the first week of November, they crossed 33,866 and 10,490 marks, respectively.
According to a report by Business Standard, mutual funds poured Rs 102,810 crore in equities which is three-times higher than what they pumped in the market during the same period in 2016. Foreign Portfolio Investors (FPI), on the other hand, invested Rs 48,190 crore in the equity segment in 2017 (CY17). Last year, FPI’s investments stood at Rs 43,280 crore during the same period.
S Naren, executive director and chief investment officer (CIO) at ICICI Mutual fund AMC said that growing participation from retail investors and the widespread awareness about the benefits of investing in financial assets via mutual fund has led to this surge. And the experts believe that it will continue to surge, unless there is a major global negative development that changes investors’ sentiments towards equities. Real estate is one of the alternate asset classes that are likely to give moderate returns in the future.
Moreover, only 2.9% of the Indian households have invested into mutual funds and given the financial awareness in the market, this should improve and keep the flows steady.