Mutual fund assets take a dip in October: AMFI

Assets under management dropped by Rs 1,460 cr in October to Rs 2,00,209 crore.

After three months of growth, the total assets under management (AUM) of domestic mutual funds reversed trend in October.

After clocking an AUM of Rs 2,01,669 crore in September, the figures released by Association of Mutual Funds in India (AMFI) shows a decline of Rs 1460 crore for the month of October at Rs 2,00,209 crore.

The losses have come on mainly on the back of a decline in assets under management of growth schemes. While total AUM under growth schemes in October stood at Rs 57,257 crore, it was Rs 2,562 crore lower than the figure in September.

Balanced funds, gilt funds and tax saving (ELSS) funds also showed a decline in assets during the month.

While AUM under balanced schemes came down by Rs 32 crore to Rs 6153 crore in October, gilt funds declined by Rs 98 crore to Rs 3795 crore, while AUM of ELSS schemes came down by Rs 479 crore to Rs 3102 crore.

According to Vinit Potnis, chief marketing officer of Cholamandalam Mutual Fund, the market correction witnessed last month have led to an erosion in asset values in October.

"Luckily the market bounced back quickly before investors could react to the fall and trigger off redemptions" a fund distributor said.

As of October 31, 2005, liquid funds have the maximum assets under management with Rs 74984 crore, representing 37 per cent of the total mutual fund assets.

Liquid funds saw a net inflow of Rs 926 crore during October. Income funds saw total sales of Rs 17439 crore in October, compared to redemption of Rs 16806 crore. This amounts to a net inflow of Rs 633 crore.

Growth schemes saw a net inflow of Rs 2827 crore, while balanced funds and liquid funds saw net inflows of 312 crore and 388 crore respectively. ELSS schemes saw a net inflow of Rs 135 crore. Gilt schemes were the only category to report a net outflow at Rs 114 crore.

Among individual funds, LIC Mutual Fund saw the maximum rise in AUM. The fund saw inflows of Rs 801 crore to take its total AUM to Rs 4899 crore. The fund had launched LIC MF Fixed Maturity Plan Series 1 (six month plan) and LIC MF Fixed Maturity Plan Series 1 (one year plan), during the month.

DSP Merrill Lynch Mutual Fund and ABN Amro Mutual Fund were the next best, posting an increase of Rs 669 crore and Rs 518 crore in AUMs respectively. On the other hand, Prudential ICICI Mutual Fund saw its total AUM decline by Rs 1051 crore in October, the biggest decline among all funds.

Franklin Templeton (down Rs 922 crore) and Principal PNB Mutual Fund (down Rs 717 crore) registered the next biggest declines. In terms of percentage, Sahara Mutual Fund saw an increase of 43.53 per cent to Rs 666 crore, followed by ABN Amro Mutual Fund, which saw its assets grow 19.62 crore to Rs 3158 crore in October.