Buy the dips trigger record inflows into equity mutual funds in October

Equity mutual funds experienced a significant surge in inflows in October, reaching a historic high of Rs 41,887 crore, a 22 per cent increase from the previous month, even as the stock markets faced a sharp correction.

Actively managed equity mutual funds saw record inflows in October, according to the latest data from the Association of Mutual Funds in India (AMFI). Equity fund inflows increased by 21.7 per cent, reaching Rs 41,886.7 crore, while the total mutual fund industry witnessed inflows of Rs 2.4 lakh crore. This came after the industry faced outflows of Rs 71,114 crore in September.

Equity Fund Inflows by Category

• Large-Cap funds saw an inflow of Rs 3,452 crore, up from Rs 1,769 crore in September.
• Mid-Cap funds recorded Rs 4,683 crore in inflows, compared to Rs 3,130 crore the previous month.
• Small-Cap funds saw inflows of Rs 3,772 crore, compared to Rs 3,071 crore in September.
• Flexi-cap funds attracted Rs 5,181 crore, while Multi-cap funds saw inflows of Rs 3,215 crore.
• Sectoral and thematic funds experienced a slight moderation, with inflows of Rs 12,278 crore, down from Rs 13,254 crore in September.

Record SIP Contributions
Systematic Investment Plan (SIP) contributions reached an all-time high of Rs 25,322.74 crore in October, representing 20 per cent of the industry’s total assets under management. This surpassed the previous record set in September, where SIP contributions stood at Rs 24,508.73 crore.

Debt Fund Inflows
Debt funds also saw strong inflows in October, with Rs 1.57 lakh crore entering the segment, a notable recovery from the Rs 1.14 lakh crore outflow in the previous month. Overnight funds recorded inflows of Rs 25,784 crore, while liquid funds attracted Rs 83,863 crore.

Hybrid and Passive Fund Activity

• Hybrid Funds saw inflows of Rs 16,863 crore in October, up from Rs 4,901 crore in September. Arbitrage funds were the primary drivers of this growth.
• Passive funds attracted Rs 23,428 crore, a significant increase from Rs 3,254 crore the previous month. The Other ETFs category received the largest portion of these inflows, totalling Rs 13,441 crore.

New Fund Offerings (NFOs)
October saw NFOs contributing Rs 6,078 crore to the industry, with the Index Funds category leading the way. In September, NFOs contributed over 50% of the inflows, with a total of Rs 14,575 crore, including Rs 3,517 crore from sectoral and thematic fund NFOs.

This record-breaking activity reflects retail investors' confidence in mutual funds and their growing preference for systematic investing, even amid market volatility.

Disclaimer: The article is for informational purposes only and not investment advice.