MF Update: June AUM fell by 6.5 per cent on monthly basis

Shashikant Singh
/ Categories: Mutual Fund
MF Update: June AUM fell by 6.5 per cent on monthly basis

The asset under management (AUM) of the domestic mutual fund industry fell by 6.5 per cent on a month on month basis. It fell from Rs. 25.93 lakh crore in the month of May to Rs. 24.25 lakh crore. One of the reasons for such a fall in the AUM is an outflow from Income and Debt schemes. In the month of June, debt category funds saw a net outflow of Rs. 1.71 lakh crore against an inflow of Rs. 70 thousand crore in the month of May.

Beside the Banking and PSU Fund, all other major debt category funds have witnessed an outflow in the month of June 2019. Highest outflow was witnessed in liquid funds. It has seen a net outflow of Rs. 1.52 lakh crore. One of the reasons experts are attributing for such outflow from the liquid fund is, it is a quarter-end phenomenon and most of them might have been back into the system. However, a look into last year's inflow data for the same month shows that liquid funds have in fact seen a net inflow of Rs. 52,104 crore. Credit risk and Medium duration fund have seen a continuous outflow of funds for the second consecutive month.

Contrary to the debt funds, all categories of equity funds have witnessed a net inflow except for Dividend Yield fund that has witnessed an outflow of Rs. 11 crore. Highest inflow was witnessed in multi-cap funds followed by large-cap funds. A total of Rs. 7,663 crore was net inflow in the month of June 2019 compared to Rs. 5,407 crore in the previous month. Investments through monthly systematic investment plans (SIPs) in June fell to Rs. 8,122 crore from Rs. 8,183 crore in May. According to the industry experts, most of the fall in SIP is witnessed in the direct plan, which is mostly not routed through financial advisors.

At the end of June 2019, equity forms now 30 per cent of total AUM compared to 28 per cent in the month of May 2019. In the same period, the share of debt funds has fallen from 45 per cent to 41 per cent in the month of June.

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