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Saturday, November 27, 2021

There is a record rise in the stock market, why are mutual funds withdrawing money? Selling continuously for 7 months

Equity Mutual Funds: The stock market is creating new records every day, on the other hand mutual funds are completely cautious and are making profits.

Equity Mutual Funds: On one hand the stock market is creating new records every day, on the other hand in this record boom, mutual funds are fully alert and are making profits. In January, for the 7th consecutive month mutual funds have withdrawn money from the stock market. In January, Equity Mutual Fund pulled out Rs 9,253 crore from equity. Net outflow in January was Rs 35,586 crore. In January, mutual funds were also cautious in debt segment and during this time they have withdrawn Rs 33409 crore. Let us know that mutual funds invested in debt funds in December.

When did you get out of equity?

Mutual funds pulled out Rs 9,253 crore from the stock market in January. At the same time, in December, Rs 10,147 crore was withdrawn from equity. The month of November saw an outflow of Rs 12,917 crore from equity mutual funds and Rs 2,725 crore in October. In September, mutual funds pulled out Rs 734 crore from equity, Rs 4,000 crore in August and Rs 2,480 crore in July. While inflow of 240.55 crore rupees was seen in this segment in June.

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Why are you withdrawing money from the stock market?

In fact, the stock market continues to rally. Since November 2020, the days that have come on the market are creating new records. In this boom, many stocks are at their record highs or 1 year highs. In such a situation, profit recovery is also a reason to withdraw money from the stock market. Second, fund houses are cautious given the record valuation of the market. There is a possibility of further correction. Therefore, the shares in which they have got profit, they are being sold. However, foreign investors and retail investors, on the other hand, are continuously pouring money into the market, which has created a rally in the market and there is no effect of selling of mutual funds. In January, investors bought shares worth about 19 thousand 472 crores.

Investment in gold ETFs

Although there is confidence about gold ETFs. Inflows of Rs 625 crore have taken place in Gold ETFs in January. While this segment had an inflow of Rs 431 crore in December. Talking about debt-cutting, the mutual fund pulled out 33,409 crore from it in January, while in December, an investment of 13,863 crore came in this category. Asset under the management of the mutual fund industry declined to 30.5 crore at the end of January from 31.02 lakh crore in December 2020.

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