Mutual Fund asset base hits new high of Rs 16.5 lakh crore in November

Mutual fund industry's asset base surged to all-time high of Rs 16.5 lakh crore at the end of November, helped by strong inflows in income and equity segments.

Comprising 43 active players, the industry had assets under management (AUM) of over Rs 16.28 lakh crore at the end of October, which was the previous all time high, rising to Rs 16.50 lakh crore in November-end, as per the latest data by Association of Mutual Funds in India (AMFI).

Industry experts attributed the monthly rise in asset base to inflows in income and equity categories. Besides, they added, buoyant investor sentiment has helped the AUM growth.

Overall inflows in MF schemes stood at Rs 36,021 crore at at the end of last month compared to Rs 32,334 crore at October-end.

Income funds, which invest in government securities, saw an inflow of Rs 18,306 crore, while equity and equity-linked saving schemes witnessed an infusion of Rs 9,079 crore.

Balanced funds, which invest in equity and debt instruments, saw an inflow of Rs 3,632 crore. However, Gold exchange traded funds (ETFs) witnessed a pull out of Rs 69 crore during the period under review.

Mutual funds are investment vehicles made up of a pool of funds collected from a large number of investors and invest in stocks, bonds and money market instruments.

Bajaj Capital Group CEO and Director Anil Chopra said net inflows in most categories are positive and much higher than in the previous months. Over Rs 19,000 crore has also flown into various debt funds on net basis.

"Demonetisation has played a major role in these buoyant. Bank accounts of citizens are plush with liquidity as huge amount of surplus funds has shifted from parallel economy to financial systems and equity markets have reacted negatively to demonetisation giving fresh set of opportunities to investors who were waiting for correction or decline in prices," Chopra said.

Outlook for next month seems to be even more positive as massive shift will be experienced when excess liquidity in savings accounts, Jan Dhan accounts are channelised into debt and equity mutual funds, he added.