Investors SIP on equity and small caps, June MF flows more than double of May

economictimes.indiatimes.com:

mutual funds rose to ₹8,638 crore in June, higher than May's ₹3,240 crore. Investors have been allocating more to small- cap funds in the last three months as they believe they will benefit the most as economic growth picks up. Investors continued to stagger their long-term investments using systematic investment plans (SIPs) with collections at ₹14,734 crore marginally lower than the previous month's ₹14,749 crore. Due to a rise in equity markets and inflows into equity schemes, assets under management (AUM) of the industry touched ₹44.82 lakh crore.

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Within equity mutual funds, small- cap funds received a bulk of the flows, followed by mid-cap funds while large-cap, focused and ELSS schemes saw investors booking profits. «Investors should be cautious and not overexpose their equity portfolios towards small-cap funds, where volatility could be high in near term. At these levels, they need to take a balanced exposure and stagger their investments using SIP/STP,» says G Pradeepkumar, CEO, Union Mutual fund. Within equity, small-cap schemes saw inflows of ₹5,472 crore, while the mid-cap, large- and mid-cap categories saw inflows of ₹1,749 crore and ₹1,147 crore, respectively. Investors pulled money out of large-caps schemes with the category seeing net redemptions of ₹2,050 crore, while focused funds and ELSS schemes also saw outflows of ₹1,018 crore and ₹475 crore respectively. With the broader Nifty 50 and S&P BSE Senex at their all-time highs in June, many investors booked profits in large-cap funds. Investors also took advantage of the rally in Nasdaq which has moved up by 36% since the start of the calendar year