Increased attractiveness of small-cap mutual funds, investors put in Rs 11,000 crore in June quarter

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Data from the Association of Mutual Funds in India (AMFI) showed outflows of Rs 3,360 crore from large-cap mutual funds during the quarter under review.

New Delhi. Investors are now preferring mutual funds investing in smaller companies (small-caps) over large-caps and have made a net investment of around Rs 11,000 crore in these schemes in the April-June quarter. Analysts said this is because fund managers have not been able to deliver great results by investing in large companies and this trend is expected to continue for some time to come. Data from the Association of Mutual Funds in India (AMFI) showed outflows of Rs 3,360 crore from large-cap mutual funds during the quarter under review.

Small-cap funds saw an inflow of Rs 6,932 crore in the March quarter ahead of the June quarter. Himanshu Kohli, Co-Founder, Client Associates, said, “The strong rally in mid-cap and small-cap indices over the last few months is because the large-cap space is finding it difficult to deliver strong results. This could be one of the reasons for investing heavily in smallcap funds. He said that heavy investment in these funds has made fund managers more cautious in their selection of stocks, as their valuations have gone up.

He said this always happens in the market as fund managers always look for stocks at a good price. Firoz Aziz, deputy chief executive officer (CEO), Anand Rathi Wealth, said investors are preferring small-caps because they carry the same level of risk as mid-caps, but have higher return potential. In the mutual fund sector, the small-cap category has given excellent returns of 30-37 per cent in one year, 40-44 per cent in three years and 18-21 per cent in five years.

Disclaimer:IndiaTheNews has not edited this news. This news has been published from PTI-language feed.



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