Debt mutual funds look at the strong flow at the end of the year in January – CNBC TV18

Debt mutual funds look at the strong flow at the end of the year in January – CNBC TV18

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Debt Mutual Fund recorded a sharp reversal in January 2025, with a net flow to â‚ı 1.28 lakh crore. According to data from the Association of Mutual Funds (AMFI), in December 2024, run by quarter-end withdrawal and tax-related redemption, it comes after heavy outfits of 1.27 lakh crores.

Index fund corner

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Liquid funds attracted â‚ı 91,5923 crore, followed by money market funds () 21,915 crore) and overnight fund (â‚ı 18,936 crore).


Why increased?

Nehal Meshram, Senior Analyst Research, Morningstar Investment Research India said, “This bounce follows quarter-end tax outflow in December, as corporates and institutions re-inactivated cash in short-term loan equipment for liquidity management again The funds are prepared by providing minimum access to the interest rate and capital, which makes them ideal for parking.

However, the flows were not widespread-based. Out of 16, 11 loan mutual funds have still recorded a pure outflow.

Investor preference shift

  • Long -term funds saw a minor influx of â‚ı 201 crores.

  • The gilt funds had to face outflows of 1,359 crore, reversing the previous profit.

  • Credit Risk Funds continued to struggle, looked at the outflow of â‚ı 294 crore, as investors preferred safe, AAA-rated equipment.

  • Floter Funds saw the outflow of â‚ı 1,129 crore, as the possibility of the interest rate hike cycle was at its peak, which reduced their appeal.

Tata Asset Management, Chief Business Officer, Anand Vardarajan said, “Under the leadership of loan liquid and ultra-short categories, â‚ı 1.28 lakh crore was reduced to meaningful positive on net flow of net flow. Not found, while not getting the favor, while not found the favor, while not getting the favor, while the favor was not found, while investors selected to stay liquid and preferred the funds of the ultra-short term.

What will happen next?

Investors are giving priority to liquidity and flexibility, waiting for clear indications on interest rates. The short -term debt funds remain a favorite option amidst economic uncertainties, while long -term categories struggle to demand.

Also read Equity mutual fund inflow falls 3.56% in January; Small, middle and large-cap funds see benefits

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