Most MF categories witness outflows in August

Most mutual funds categories witnessed net outflows in August as cautious investors continued to sell their investments and held on to cash, probably to tackle the uncertain environment created by the Covid pandemic. August marked the fifth straight month of fall in inflows in the equity mutual funds, shows monthly data from Amfi.

Net outflows from equity mutual funds stood at Rs 3,999.62 crore, compared to outflows of Rs 2,480.35 crore in July. Almost all the equity fund mutual fund categories saw redemptions. Equity mutual funds saw a total inflow of Rs 14,558.20 crore and outflow of Rs 18,557.82 crore.

Scheme Name Funds Mobilized for the month of August 2020 Repurchase/ Redemption for the month of August 2020 Net Inflow (+ve)/Outflow (-ve) for the month of August 2020
Multi Cap Fund 2,617.49 3,774.69 -1,157.21
Large Cap Fund 2,779.02 4,332.52 -1,553.50
Large & Mid Cap Fund 1,161.39 1,328.04 -166.65
Mid Cap Fund 1,637.53 2,240.51 -602.98
Small Cap Fund 1,224.04 1,328.44 -104.39
Dividend Yield Fund 17.24 55.85 -38.62
Value Fund/Contra Fund 674.91 1,454.74 -779.83
Focused Fund 1,335.57 1,330.76 4.80
Sectoral/Thematic Funds 2,122.38 1,752.48 369.90
ELSS 988.64 959.80 28.85

Debt mutual fund schemes also felt the redemption pressure with net outflow standing at Rs 3,907.53 crore. The outflows have come at a time when debt fund NAVs have seen a fall amid rising yields.
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CategoryFunds Mobilized for the month of August 2020 Repurchase/ Redemption for the month of August 2020 Net Inflow (+ve)/Outflow (-ve) for the month of August 2020
Overnight Fund 1,56,303.24 1,66,601.27 -10,298.03
Liquid Fund 2,79,186.32 2,95,000.33 -15,814.01
Ultra Short Duration Fund 14,744.51 9,316.74 5,427.77
Low Duration Fund 20,008.13 14,639.67 5,368.46
Money Market Fund 21,020.50 13,108.97 7,911.53
Short Duration Fund 10,092.21 9,893.69 198.52
Medium Duration Fund 1,492.51 490.60 1,001.91
Medium to Long Duration Fund 339.09 377.76 -38.67
Long Duration Fund 152.11 37.86 114.25
Dynamic Bond Fund 2,050.43 506.46 1,543.97
Corporate Bond Fund 7,645.12 5,690.06 1,955.06
Credit Risk Fund 182.20 736.35 -554.14
Banking and PSU Fund 8,402.20 7,701.31 700.89
Gilt Fund 2,952.17 4,074.27 -1,122.10
Gilt Fund with 10 year constant duration 78.52 103.71 -25.19
Floater Fund 3,216.59 3,494.34 -277.75
Total 5,27,865.84 5,31,773.37 -3,907.53

Hybrid funds on the other, stabilised a little in July. From a net outflow of Rs 7,301.29 in July, hybrid funds saw net ouflows of Rs 4819 crore in August. This was primarily led by Multi Asset funds which saw inflows worth Rs 830 crore in July.

Scheme Name Funds Mobilized for the month of August 2020 Repurchase/ Redemption for the month of August 2020 Net Inflow (+ve)/Outflow (-ve) for the month of August 2020
Conservative Hybrid Fund 290.54 251.64 38.90
Balanced Hybrid Fund/Aggressive Hybrid Fund 1,016.64 3,371.95 -2,355.31
Dynamic Asset Allocation/Balanced Advantage 1,673.78 2,048.92 -375.14
Multi Asset Allocation 1,111.12 280.21 830.92
Arbitrage Fund 2,802.22 5,346.75 -2,544.53
Equity Savings 103.83 518.13 -414.29

"Equity-oriented mutual funds witnessed net outflows for the second month in a row. Also, the quantum of net outflows in August was significantly higher than in July. The number of folios as well as funds mobilized during the month was marginally higher than July. But at the same time the redemptions too shot up sharply. This indicates that more investors chose to booking profit given the surge in the equity markets across segments in the recent times," says Himanshu Srivastava, Associate Director - Manager Research, Morningstar India.

"With equity markets doing well for some time and stable scenario in the fixed income markets, Hybrid schemes too witnessed significant net outflows, with investors viewing this scenario as a good exit opportunity. Balanced Hybrid Fund/Aggressive Hybrid Fund, whose mandate is to invest between 65-80% of assets in equities, witnessed a net outflow of INR 2,355.3 crores in August. Otherwise too, this category has been witnessing consistent net outflow for a long time, given the challenging scenario in both equity and debt markets earlier," Srivastava added.