With the markets remaining volatile for the best part of 2010-11, exits made by equity MF investors , who were wary of losing their gains, hit a record high. Redemptions or the money pulled out by investors from equity MF schemes have topped Rs 79,730 crore in fiscal 2011, the highest ever, data with the Securities and Exchange Board of India (Sebi) shows.
Interestingly, redemptions from equity schemes in 2010-11 is even higher than thatof 2007-08 when they took out Rs 79, 353 croreon theback of a sharp rise in the equity markets. Investors booked profits whenever the benchmark indices traded close to their all-time highs in fiscal 2011, analysis shows.
The 27.4% y-o-y rise in redemptions from equity schemes has also led to a sharp fall in folios or investor accounts. Equity MFssaw net outflows (difference between sales and purchases made by investors) of Rs 13,138.1 crore, Sebi data shows.
The folios held by investorsin equity MFschemesfell by over 18 lakh to 3.92 crore in 2010-11. Folios in equity schemes have fallen below the 4-crore mark for the first time in three years. Investors pulled out Rs 12,804 crore from equity MF schemes in September last year, about 50% more than the previous high hit in October 2007 when the markets started trading close to their all-time highs.
A lot of investors booked profits when the markets went up ; and the general apathy shown by agents in pushing productstosmall retailinvestors ever since the ban on entry loads came also resulted in high pullouts , industry officials say.
"The real impact of the ban on entry loads (on MF sales ) was felt in fiscal 2011," says Surajit Misra, national head, MFs, Bajaj Capital, a distribution platform for funds . "Retail (investor ) participation has been quite muted ," he says. With no big asset creation happening, the bottom line of fund houses would have taken a knock last fiscal , he says.
New investors are not coming in and big-ticket participants who entered the markets remained only for the short-term , say industry officials .
Source: http://economictimes.indiatimes.com/personal-finance/mutual-funds/mf-news/equity-mf-pullouts-hit-a-high-in-2010-11/articleshow/8062999.cms
Interestingly, redemptions from equity schemes in 2010-11 is even higher than thatof 2007-08 when they took out Rs 79, 353 croreon theback of a sharp rise in the equity markets. Investors booked profits whenever the benchmark indices traded close to their all-time highs in fiscal 2011, analysis shows.
The 27.4% y-o-y rise in redemptions from equity schemes has also led to a sharp fall in folios or investor accounts. Equity MFssaw net outflows (difference between sales and purchases made by investors) of Rs 13,138.1 crore, Sebi data shows.
The folios held by investorsin equity MFschemesfell by over 18 lakh to 3.92 crore in 2010-11. Folios in equity schemes have fallen below the 4-crore mark for the first time in three years. Investors pulled out Rs 12,804 crore from equity MF schemes in September last year, about 50% more than the previous high hit in October 2007 when the markets started trading close to their all-time highs.
A lot of investors booked profits when the markets went up ; and the general apathy shown by agents in pushing productstosmall retailinvestors ever since the ban on entry loads came also resulted in high pullouts , industry officials say.
"The real impact of the ban on entry loads (on MF sales ) was felt in fiscal 2011," says Surajit Misra, national head, MFs, Bajaj Capital, a distribution platform for funds . "Retail (investor ) participation has been quite muted ," he says. With no big asset creation happening, the bottom line of fund houses would have taken a knock last fiscal , he says.
New investors are not coming in and big-ticket participants who entered the markets remained only for the short-term , say industry officials .
Source: http://economictimes.indiatimes.com/personal-finance/mutual-funds/mf-news/equity-mf-pullouts-hit-a-high-in-2010-11/articleshow/8062999.cms
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