Total redemptions of all schemes stood at Rs1.19 lakh crore in June while equity funds witnessed Rs1,446 crore of net redemptions, despite the launch of six NFOs
The inflow of Rs1,256 crore for equity funds in May 2010 was a fleeting affair. Equity funds have continued to witness outflows in June 2010 and this time the outflow is one of the highest, which would lead to intense debate on the current regulations that govern fund-selling and put pressure on the market to introspect.
According to data released by the Association of Mutual Funds in India (AMFI), equity mutual funds have recorded Rs1,446 crore of redemptions in June 2010.
Meanwhile, the BSE Sensex was up 7% in June. The total outflow of all schemes stood at Rs1.19 lakh crore. Income funds have also suffered Rs1.34 lakh crore in outflows.
In June, six equity funds were launched. These were Baroda Pioneer Infrastructure Fund, Birla SunLife India Reforms Fund, DSP BlackRock Focus 25 Fund, ICICI Prudential Nifty Junior Index Fund, IDBI Nifty Index Fund and Taurus Nifty Index Fund. Put together, they raised Rs1,068 crore. Gross sales of existing schemes were Rs3,873 crore. However, redemptions from existing schemes were as high as Rs6,387 crore, leaving a net outflow of Rs1,446 crore.
Industry experts are citing low sales and continuous profit-booking as the reason for redemption in equity funds. Sales of equity schemes stood at Rs1,068 crore in June 2010.
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