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MFs invest Rs 32k cr in debt in Oct, total crosses Rs 5-tn

In 2013, mutual funds had invested a net of Rs 5.12 lakh crore in the bond market. Industry experts attributed the inflows in debt to the new government’s reforms agenda, improved fundamentals of the Indian economy and high interest rates.

MFs invest Rs 32k cr in debt in Oct, total crosses Rs 5-tn

mutual funds pumped in close to a whopping Rs 32,000 crore in the bond market in October, taking the total investment to more than Rs 5 lakh crore since the beginning of the year. In comparison, foreign investors made a net inflow of a staggering 1.4 lakh crore in the debt market so far in 2014.

As per the latest data compiled by market regulator Sebi, the net investment by mutual funds (MFs)in the debt market during October stood at Rs 31,917 crore. This takes the total net investment by MFs into the bond market to Rs 5,27,435 crore so far this year. In 2013, mutual funds had invested a net of Rs 5.12 lakh crore in the bond market. Industry experts attributed the inflows in debt to the new government’s reforms agenda, improved fundamentals of the Indian economy and high interest rates.

Mutual funds are investment vehicles made up of a pool of funds collected from a large number of investors. MFs invest in stocks, bonds, money market instruments and similar assets. Moreover, MFs picked up shares to the tune of over Rs 5,900 crore in the equity market last month, making it the fifth consecutive monthly inflow. MFs have turned net buyers of equities since May 2014. Prior to that, fund houses have been net sellers in the equity market since September last year, while they were net buyers of shares to the tune of Rs 1,607 crore in August 2013.

The latest inflows takes the total net investment by MFs in stocks to Rs 14,000 crore so far this year.

Q Close-ended mutual funds have a:

  • Fixed NAV
  • Fixed fund size
  • Fixed rate of return
  • Fixed distributors

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