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Mutual funds (MFs) invested a record Rs 1.73 trillion in equities in the financial year 2022-23 (FY23), providing strong support to the Indian markets at a time when foreign investors were redeeming their holdings. They exceeded the previous high of nearly Rs 1.72 trillion investment in equities in FY22.
The data from the Securities and Exchange Board of India (Sebi) shows MFs were net buyers in the equity market in eleven of the twelve months last financial year. Foreign institutional investors (FIIs) redeemed a net Rs 35,000 crore in FY23. They were net sellers in the previous FY, too, when they pulled out over Rs 1.4 trillion.
“Investment by MFs helped the markets hold up in FY23, even as FIIs continued to pull out money, albeit a lower quantum than FY22. Since the MF money is mostly sourced from retail investors, there is less fear of sudden flight of funds. Hence, it provides greater stability to the market,” said Ambar
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