Mutual funds did not witness any major redemption pressure on Tuesday as was being speculated following Monday’s record surge in equities. Industry players said investors might want to remain invested in the hope of a new bull run in the market.On Monday, the first trading day after the announcement of election results, trading had to be halted as Sensex breached the upper circuit twice on course to a 17.3 per cent, or 2,110 points, jump. However, as trading was closed after 12 noon on Monday, few traders or investors got a chance to trade. Mutual fund houses declared it as no-trading day and declined to redeem or sell units at the day’s NAVs (net asset values).This led to speculation that mutual funds would see huge outflow when the market opens on Tuesday as investors would rush to book profit.Jayesh Shroff, equity fund manager at SBI Mutual Fund, said there is no reason for investors to exit mutual fund schemes in the present scenario. “The overall market sentiments are positive and one would like to stay invested. In fact, investors who failed to invest on Monday as fund houses declared it a no-transaction day put money in equity schemes hoping for a strong rally in the market,” he added.Jaideep Bhattacharya, vice-president (marketing) with UTI Mutual Fund, said had there been better investment avenues other than equities, there could have been redemptions from equity funds. But that was not the case as most debt and fixed income instruments have been giving lower returns than equities.“Over the past two days, foreign institutional investors (FIIs) have invested around $5 billion in the Indian markets and the overall market sentiment, too, is buoyant. In such a scenario, it is in the benefit of investors to stay invested,” he added.According to data provided by Sebi, mutual funds could net-invest just Rs 50 lakh in equities on Monday as against Rs 1,000 crore investment by FIIs. On Tuesday, FIIs were net investors in equities to the tune of Rs 53 crore. Data on mutual funds’ equity investments on Tuesday were not available with the Sebi at the time of filing of the report. Rajiv Deep Bajaj, managing director of Bajaj Capital, a brokerage firm that also distributes mutual funds, said his company witnessed fresh investments in mutual funds on Tuesday. “The general macroeconomic environment of the country looks good following the election results and the equity market sentiments have changed. The fear that markets would correct below the 10,000-level is gone and we see the market in the 12,000-15,000 range for some time,” he said. Vikaas Sachdeva, country head for business development, Bharti AXA Investment Managers, and Waqar Naqvi, CEO of Taurus Mutual Fund, said they witnessed inflows in their equity funds. However, the inflow figures were not available with the fund houses readily.
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