Mutual funds withdraw Rs 24,000 cr from debt schemes in July
Aug 16 2013 , New Delhi
The funds offloaded debt securities worth about Rs 23,740 crore during July, according to the Sebi data. MFs had invested Rs 64,947 crore in debt schemes in June. The debt market witnessed a net inflow of Rs 2.7 crore in the first seven months of the year.
Foreign institutional investors made a net outflow of more than Rs 12,000 crore from debt market in July.
Mutual fund is an investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets.
According to market participants, overall, fund houses have been focusing on debt schemes because of volatility in the secondary market and these schemes offer better returns as compared to bank fixed deposits.
Another reason for investing in debt schemes could be lower risk in it than equity funds.
Also, domestic mutual funds have sold shares worth Rs 2,168 crore in July, making it 13th consecutive month of net outflows.
With the latest sale of shares by mutual funds, the net withdrawal since the beginning of the year has reached Rs 15,042 crore.
At the end of June, there were a total of 1,184 schemes under mutual funds, of which 749 schemes (66 per cent of the overall schemes) were debt oriented while 346 schemes (29 per cent of total schemes) were equity related.