The sharp volatility in Indian stocks on the back of Brexit made retail investors go for one of the highest redemptions in June.
In pure diversified equity funds, investors sold units worth Rs 13,250 crore on gross basis and were countered with gross inflows of Rs 13,205 crore - leading the category into a negative territory in terms of net inflows.
This is the second largest redemption in equity segment, after March this year. And, it is significantly higher than the normal monthly redemptions, which hover between Rs 5,000-Rs 8,000 crore.
However, the overall equity segment managed to close the month in positive territory, thanks to equity-linked saving schemes, which had positive flows of Rs 365 crore.
The overall mutual fund industry saw a net outflow of Rs 21,535 crore in June, on the back of higher redemptions in the liquid and money market schemes. It is part of the typical quarterly phenomenon, wherein large investors like financial institutions and corporates tend to pull out the cash to strengthen their balance sheets. Normally, this money comes back in mutual funds by the middle of the successive month.
Balanced funds, which offer a mix of two asset classses - debt and equity - continued their good run, as the category saw strong inflows of Rs 2,402 crore. Gold exchange traded funds continued to face investors’ wrath, as they sold units worth Rs 80 crore.
The overall assets under management of the industry as on June 30 stood at Rs 13.8 lakh crore. Of it, the equity segment contributed Rs 4.28 lakh crore, according to the latest monthly statistics released by the industry body Association of Mutual Funds in India.