Mutual funds assets rise by Rs 25K cr

Equity funds have continued to witness inflows for the third consecutive month, while average assets of the fund industry surged by over 2.3 per cent in the month of February.

According to the data available from the Association of Mutual Funds in India (Amfi), the MF industry witnessed inflows of Rs. 25,757 crore in all the schemes with equity and money market schemes seeing inflows of Rs. 2,495 crore and Rs. 8,770 crore respectively in February.

The data from the Amfi also showed that assets under management (AUM) of the industry stood at Rs. 7.07 lakh core in February against Rs. 6.91 crore in January. The AUM was Rs. 6.65 lakh crore in 2009 and Rs. 6.26 lakh crore in 2010. Total equity assets stood at Rs. 1.59 lakh crore fall of over 4 per cent against January which was at 1.65 lakh crore.

Market participants feel that banks and corporates and banks are again willing to invest in MFs aggressively for better returns. A big chunk of money is flowing into the FMPs (fixed maturity plans) before the end of the financial year in order to get double indexation benefit.

"Also several fund houses have declared huge dividends in the last one month, attracting more retail investors. In the last few months we have been witnessing lot of distributors again selling mutual funds," said a top official from a leading fund on condition of anonymity.

Systematic investment plans (SIPs) are also becoming popular again. "Inflows in equity schemes were coming through systematic investment plans. Income schemes also saw inflows of Rs. 13,708 crore largely due to launch of several fixed maturity plans in February," he said.

Krishnamurthy Vijayan, managing director & CEO of IDBI MF said, "Inflows in equity schemes indicate that investors are coming in despite markets being weak and volatile.

This is very positive sign. Apart from that, new SIP accounts have been built up over the past few months and now we are witnessing sustained inflows from that section."

Source: http://www.financialexpress.com/news/mutual-funds-assets-rise-by-rs-25k-cr/760188/0

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