Domestic mutual fund investors continued to book profits even as equity markets surged unabated. The Nifty 50, which had gained 11.3% in November, rallied another 900 points or 7.8% in December to cross the 14,000 milestone. These gains have been primarily fuelled by foreign institutional inflows as such investors pumped in more than Rs 1.1 lakh crore on a net basis in the last two months of 2020.
“Outflows from equity-linked funds have continued because markets are at all-time highs and investors are booking profits and choosing to stay on the sidelines,” NS Venkatesh, chief executive officer at AMFI, said during a call with reporters. “There is a gross inflow of Rs 26,073 crore into equity-linked mutual funds in December, so it is not that individuals are not investing in these funds.”
Kirtan Shah, the chief financial planner at Sykes & Ray Equity, said, “A lot of people have been calling us to book profit. Retail investors are pulling out money. A lot of them are getting out because after seeing such a dramatic fall, they are now seeing some money come back. And they’re unsure whether these levels are sustainable. They’re probably worried that there will be a big fall.”
