Mark to market losses lead to YoY decline in mutual fund assets

The Indian mutual fund industry's year-on-year (YoY) assets fell over 2% in 2011 to Rs 6.11 trillion as of end December 2011, due to mark to market losses in the equity category, despite net inflows of Rs 197 billion over the year, according to a study by ratings firm Crisil. This was the second consecutive year of decline in assets with the industry having logged a 6% (YoY ) decline as of December 2010. The decline in the previous year was on account of net outflows of Rs 907 billion from mutual funds.

For the calendar year 2011, assets of equity funds fell around 23% following mark to market losses in the underlying markets where the benchmark S&P CNX Nifty was down by over 24% in the year. Despite this trend, equity funds witnessed net inflows of around Rs 77 billion in 2011. In 2010, equity funds' assets had risen over 5% to Rs 2.08 trillion on the back of mark to market gains despite net outflows of over Rs 158 billion in the category. The S&P CNX Nifty had risen around 18% in 2010.

Source: http://economictimes.indiatimes.com/markets/stocks/market-news/mark-to-market-losses-lead-to-yoy-decline-in-mutual-fund-assets/articleshow/11464609.cms