Few stocks going up due to flight to safety, says MD of Sundaram MF

In the long term, large-cap schemes may find it a challenge to generate alpha given a lot of ETF money is entering the market

Inflows into equity mutual funds (MFs) have continued to remain strong in recent days. Sunil Subramaniam, MD of Sundaram MF, says fund managers are deploying incremental liquidity into select large caps. Subramaniam spoke to Samie Modak ahead of the launch of the new fund offer (NFO) of Sundaram Services Fund. Edited excerpts:

Equity inflows continue to remain strong. Do you think fund managers are being forced to buy because of it?

A scheme cannot sit on more than 3-5 per cent cash. So yes, they are forced to buy. We have seen a select few stocks rising this year.