The inflows stood at ₹7,303 crore during the month as against ₹2,258 crore in November, but lower than ₹9,390 crore seen in October.
Monthly inflows through systematic investment plans (SIP) continue to increase steadily, touching ₹13,573 crore compared to ₹13,307 crore in November.
The average assets under management (AUM) of the industry rose to ₹40.76 lakh crore compared to ₹40.49 lakh crore in the previous month. Mid-cap and small-cap funds attracted the bulk of the flows with such schemes receiving flows of ₹1,962 crore and ₹2,245 crore, respectively.
“Mid-cap and small-cap indices have been relative underperformers compared to their large-cap peers over the last 12-18 months. Savvy investors are using this opportunity to buy the dip in these two categories,” said Raghav Iyengar, chief business officer at Axis Mutual Fund.
Investors, however, booked profits in some thematic and focused funds with these categories seeing outflows of ₹164 crore and ₹204 crore, respectively.
The fixed income space saw outflows of ₹21,947 crore, led primarily by liquid funds that saw outflows of ₹13,852 crore. Floater funds saw outflows of ₹2,240 crore, medium-term funds at ₹1,800 crore and banking & PSU debt funds at ₹1,353 crore, respectively.“Banks redeemed from fixed income funds due to a squeeze in liquidity and to meet credit offtake requirements. Several corporate treasuries invested in direct bonds or bank FDs, which further led to outflows from funds,” said Sandeep Bagla, CEO of Trust Mutual Fund.
The index funds category, which includes both passive equity and debt funds, saw inflows of 6,737 crore as investors locked into high-yield passive target maturity funds.
Multi-asset funds which invest in a mix of equity, debt and gold saw inflows of 1,711 crore, as investors believe gold and debt will protect portfolios from volatile equities. Dynamic asset allocation funds, which invest in equity and debt based on market valuations, saw outflows of 413 crore, while aggressive hybrid funds, which allocate 65-75% of their portfolio to equities, saw inflows of 59 crore.
With spreads improving, arbitrage funds that have seen continuous outflows for the last six months saw inflows of 883 crore, as investors preferred them over liquid funds to earn more with better tax efficiency.
Gold exchange-traded funds (ETFs) saw outflows of 273 crore, after the sharp run-up in the price of the yellow metal with investors earning 18% in the last year.
