Equity Fund Vs Debt Fund: In the Corona crisis, once again investors have started shifting to debt funds instead of equity. According to the data of the Association of Mutual Funds of India Amfi, the net inflows of debt funds of mutual funds in the month of April stood at Rs 100903.48 crore. Whereas in March it was about half Rs 52,528.07 crore. It is believed that amidst the growing cases of COVID 19, investors are once again looking for a safe investment option. In such a situation, his inclination has once again shifted towards a debt fund considered safe rather than equity. Net inflows to equity oriented funds stood at Rs 3,437.37 crore in April.
How much investment came in which category
Talking about debt funds, this segment saw a net inflow of 41,507 crore in liquid funds in April, 20,287 crore and 18,492 crore in money market fund and overnight fund, 9,322 crore in low duration fund, 1,246.52 crore in short duration fund and A net inflow of Rs 8919 crore has come into Ultra Short Duration Fund. While the floater fund has a net inflow of Rs 3,352 crore. At the same time there has been an outflow of 150.91 crores in Banking and PSU funds. Dynamic bond fund has the highest outflow of Rs 2,103.01 crore.
Looking for safe returns
Himanshu Srivastava, Research Manager, Morningstar India, says that if you look at the data, funds with short durations have got better response than other funds. It is clear from this that in the current COVID crisis, investors are looking for safe returns and they do not want to spend their money in the market for much longer. Money markets and short durations funds have become his choice.
AK Nigam, director of BNP Fincap, says that investors fear that the fall in the equity market may increase if the corona crisis escalates. The way the market fell at the time of lockdown last year is also in the attention of investors. Because of this, they are looking for such an investment where they can get better returns than the traditional small savings scheme and the risk of investment is also reduced. For this reason, investment in the category of short durations of debt segment has increased.
what should be done
Corporation says that if we talk about now, then investors should focus only on short-term options for the future. It includes overnight funds, money market, ultra short durations, short durations funds. Long-term bond funds are a better option. The way the RBI is taking measures, the bond market will gain further. Corporate bonds and dynamic bonds are a better option. On the other hand, if you talk about equity segment, then only 2 categories are advised to choose now. These include large and midcap and multicap. Now wait for the market to improve in Lorgecap, Midcap and Smallcap.
(Disclaimer: Investing in mutual funds is subject to market risks. Before investing, check at your level or consult your financial advisor. Financial Express does not recommend investing in any fund.)
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