The Inflows through SIP have come down within the past four months but according to the experts, they believe that the route still continues to be the popular one for the retail investors to take a position in mutual funds because it helps them to reduce the market timing risk.
The equity mutual funds, which mainly rely on SIP for flows, in which there is a withdrawal of Rs 2,480 crore, according to the data shown in the Association of Mutual Funds in India.
This was the primary outflow in additional than four years. As per the report, the 45-player industry raised Rs 7,831 crore through SIP route in last month. it was the lowest level recorded since September 2018, when the investment through the route have been at Rs 7,727 crore.
In June 2020 the investment was reduced to below Rs. 8000 crores for the first time after November 2018. The investment through the route was Rs 7,917 crore in June, Rs 8,123 crore in May, Rs 8,376 crore in April and Rs 8,641 crore in March. The experts said the slowdown in monthly SIP contribution may well be because of he strains on cash flows and incomes experienced by several investors on account of the Covid-19 situation.
Harsh Jain is the co-founder of Groww who said that the Indian SIP investors are showing immense resilience amid the ups and downs within the market. He also mentioned about the quantity of more mature investors who stick through ups and downs using SIPs is additionally steadily rising.
According to the current reports, the mutual funds have 3.27 crore SIP accounts through which investors regularly invest in Indian investment firm schemes. The Investments through SIPs are rising for the previous few years. The investment of SIP stood at over Rs 1 lakh crore in 2019-20, almost Rs 92,700 crore in 2018-19, over Rs 67,000 crore in 2017-18 and over Rs 43,900 crore in 2016-17
The investment plan of SIP offered by mutual funds, wherein one can invest a hard and fast amount in an exceedingly fund scheme periodically at fixed intervals, once a month, rather than making a payment investment.
