Savers caught in stampede as equity mutual fund returns turn negative

Indian savers stampeded into equity mutual funds (MFs) at a record pace, just in time to see their holdings tumble in a market rout that sent stocks plunging.

Domestic investors poured Rs 1.5 trillion ($23 billion) into these funds between April and January -- more than double the whole of the previous fiscal year, according to latest data from the Association of Mutual Funds in India. Balanced funds, which offer the benefits of stock returns with some cushion from debt, saw flows triple as Prime Minister Narendra Modi's clampdown on cash pushed hordes of first-time savers into the financial markets.