Wednesday, February 1, 2023
Market-Reporter
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate
No Result
View All Result
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate
No Result
View All Result
Market-Reporter
No Result
View All Result
Home Mutual Funds

Mutual funds: Why equity MFs are a hot favourite again

MtR by MtR
June 14, 2021
in Mutual Funds
0
Mutual funds: Why equity MFs are a hot favourite again


With interest rates of small savings schemes and bank deposits falling, many investors are switching to hybrid and equity-oriented mutual funds. Bank deposits grew at 9.7% as on May 21 as compared to around 11% a year ago.With interest rates of small savings schemes and bank deposits falling, many investors are switching to hybrid and equity-oriented mutual funds. Bank deposits grew at 9.7% as on May 21 as compared to around 11% a year ago.

Equity mutual fund investors are fast gaining confidence on the market outlook and are stepping up their investments. Equity-oriented mutual funds reported the highest monthly net inflows of Rs 10,083 crore in May, almost thrice than that of last month and the highest since February last year. For the past three months, these funds have reported net inflows after net outflows for eight consecutive months. Redemption, too, fell significantly in May as compared with the previous month, according to data from Association of Mutual Funds in India.

Related articles

ELSS mutual fund inflows drop over 48% in July: Should you invest?

August 10, 2022

What should investors in China and Taiwan funds do now?

August 9, 2022

Equities gain momentum
So, why are investors once again pumping money into equity mutual funds?

The markets touching new highs on the back of robust quarterly earnings, chances of faster pick-up in economic activities and declining Covid-19 cases after the second wave have led to renewed confidence. Moreover, with the performance of debt funds below par— the category reported net outflows of Rs 44,512 crore in May led by liquid, overnight and corporate bond funds—investors who were staying on the sidelines are slowly getting back.

With interest rates of small savings schemes and bank deposits falling, many investors are switching to hybrid and equity-oriented mutual funds. Bank deposits grew at 9.7% as on May 21 as compared to around 11% a year ago.

Himanshu Srivastava, associate director, Manager Research, Morningstar India, says significant improvement on the coronavirus situation over the last few weeks, would have provided comfort to investors. “Good quarterly results, positive earnings growth outlook over the long-term and waning concerns of any severe impact of the second wave of the pandemic on the economy, would have also boosted sentiments. This would have prompted investors to again allocate assets towards equities,” he says.

ELSS loses some traction
During the month of May, equity-linked savings scheme (ELSS) reported net outflows of Rs 290 crore as many investors booked profits. Analysts say typically inflows into ELSS pick up after September when individuals start their tax planning and peak during the three months to March. Many individuals invest in ELSS to save tax as one gets deduction of Rs 1.5 lakh under section 80C of the Income Tax Act. Investors must note that even in ELSS, systematic investment plan works better as it works in rupee cost averaging.

Hybrid remains investors’ favourite
Keeping with the trend, the hybrid schemes category reported net inflows of Rs 6,217 crore, led by arbitrage funds at Rs 4,521 crore in May. Fixed income investors are investing in hybrid schemes such as dynamic asset allocation/balanced advantage funds. For risk-averse investors, hybrid funds are a better choice as they give higher returns than debt funds and are not as risky as equity funds.

There are various combinations of equity and debt investments in hybrid schemes and investors have to select the funds based on their risk appetite. Investors can create a balanced portfolio and earn regular income along with capital appreciation in the long-term. Equity-oriented hybrid funds will invest minimum 65% of its total assets in equity-related instruments and the rest in debt-related instruments. Similarly, a debt-oriented hybrid fund will invest a minimum of 60% of its total assets in fixed-income securities like bonds, debentures, government securities and the rest in equity.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.





Source link

Related Posts

ELSS mutual fund inflows drop over 48% in July: Should you invest?

by MtR
August 10, 2022
0

According to monthly data issued by the Association of Mutual Funds in India, net positive inflows to equity mutual funds...

What should investors in China and Taiwan funds do now?

by MtR
August 9, 2022
0

After diversifying to the US markets, Indian investors had sometime back taken a fancy to the Greater China region, comprising...

How To Handle Erratic Bond Markets – Fortune India

by MtR
August 9, 2022
0

How To Handle Erratic Bond Markets  Fortune India Source link

Money Guru: 10 funds for financial independence, this 15th August – details – Zee Business

by MtR
August 9, 2022
0

Money Guru: 10 funds for financial independence, this 15th August - details  Zee Business Source link

Sen. Rubio questions Thrift Savings Plan’s exposure to Chinese companies in new mutual fund window

by MtR
August 9, 2022
0

The $706.9 billion Thrift Savings Plan, the retirement plan for 6.6 million federal employees and members of the uniformed services,...

Load More
  • Trending
  • Comments
  • Latest

Bank of England tells ministers to intervene on digital currency ‘programming’

June 21, 2021

Tips for checking smoke alarms during daylight saving time

March 12, 2022

GLOBAL MARKETS-U.S. stocks follow Europe up; Treasury yields rise, dollar firm

July 9, 2021

What will Durham County education bonds pay for? A full list

July 8, 2022
African currencies week ahead: Zambia's kwacha seen on back foot, Kenyan shilling up – Business Recorder

African currencies week ahead: Zambia's kwacha seen on back foot, Kenyan shilling up – Business Recorder

0
Maxum Foods releases Global Dairy Commodity Update for June

Maxum Foods releases Global Dairy Commodity Update for June

0
Letter: Perpetual bonds can help states fight hunger

Letter: Perpetual bonds can help states fight hunger

0
United Kingdom ETFs Are Riding the Re-Opening Momentum

United Kingdom ETFs Are Riding the Re-Opening Momentum

0

Investment in overseas real estate surges : The DONG-A ILBO

August 11, 2022

U.S. inflation CPI report, Wall Street, currencies

August 10, 2022

Alberta oil production set new record in first half of 2022

August 10, 2022

Industrial Lubricants Market to Reach $71 Billion by 2027.

August 10, 2022

Recent News

Investment in overseas real estate surges : The DONG-A ILBO

August 11, 2022

U.S. inflation CPI report, Wall Street, currencies

August 10, 2022

Alberta oil production set new record in first half of 2022

August 10, 2022

Categories

  • Asia
  • Bonds
  • Canada
  • Commodities
  • Cryptocurrencies
  • Currencies
  • Emerging Markets
  • ETFs
  • Europe & Middle East
  • IPOs
  • Latin America
  • Mutual Funds
  • Personal Finance
  • Real Estate
  • Retirement
  • Spending & Saving
  • Stocks
  • U.S. Markets
  • Privacy & Policy
  • About Us
  • Contact Us
  • Advertise with us

© 2021 Copyright Market-Reporter

No Result
View All Result
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate

© 2021 Copyright Market-Reporter