Now the monopoly of big foreign investors in the Indian stock market is ending and its command has been taken over by retail investors (common investors). The latest figures of the Association of Mutual Funds in India (AMFI) for the month of March are the biggest testimony to this. Employees and common people, who save a little money from their salary or earnings every month, have created a new history of investment through Systematic Investment Plan (SIP). Investment through SIP has reached its all-time high in March. It has increased by 8 percent to Rs 32,087 crore as compared to Rs 29,845 crore in February.
‘Super-confidence’ in equity funds, Rs 40 thousand crores came in just one month
This pace of SIP has had a direct impact on equity mutual funds (funds that invest in the stock market). Investment in equity funds has seen a huge jump of 56 percent in the month of March. This figure has reached Rs 40,450 crore, whereas exactly a month ago in February it was Rs 25,977 crore. If we compare it with the same month of last year (Rs 25,082 crore), then this is an excellent growth of 61% on an annual basis. This makes it clear that beyond traditional savings schemes, people are now placing their deep trust in the equity market for better returns in the long term.
Flexi cap becomes the first choice, small cap craze also continues
When it comes to where this money of the common man is going, the name that comes to the top is ‘Flexi Cap Funds’. Amidst the market uncertainties, investors have invested most of their money (Rs 10,054 crore) in this category. This is the second consecutive month when investment of more than Rs 10 thousand crore has come in flexi cap. Flexi cap funds give managers the freedom to invest in big, small or medium companies as per the market conditions.
Apart from this, people also have unwavering faith in small and medium companies. Strong investment of Rs 6,263 crore has been seen in smallcap funds and Rs 6,063 crore in midcap funds. However, due to the end of the financial year, perhaps investors adjusted their portfolios, due to which there was a withdrawal of Rs 437 crore from tax-saving ELSS and Rs 59.21 crore from dividend funds.
Drought of debt and hybrid funds, companies withdrew money heavily
While on one hand the equity market is booming, on the other hand the condition of debt funds which are considered safe seems to be completely opposite. There was a huge withdrawal of about Rs 2.94 lakh crore from debt mutual funds in March, whereas in February, Rs 42,106 crore came into these funds. Actually, March is the last month of the financial year. At this time, corporate houses withdraw money from liquid funds to pay advance tax and balance their balance sheet. This is the reason why Rs 1.34 lakh crore was withdrawn from liquid funds alone. There were also huge withdrawals from overnight funds and money market funds.
Along with this, there was a net withdrawal of Rs 16,538 crore from hybrid funds investing in both shares and bonds. However, amidst all this decline, multi-asset allocation funds attracted investors and new investments of Rs 5,212 crore came into it.
Also read: HDFC or SBI: If you invest money in shares of which bank, you will get huge income!