The mutual fund industry garnered over Rs 8,500 crore through systematic investment plans (SIPs) in February, a rise of 5.2 per cent from the year-ago period, even as the broader market witnessed heavy volatility amid concerns over the impact of coronavirus pandemic. With this, the total SIP contribution in the first 11 months of the current financial year rose to Rs 91,443 crore as compared with Rs 84,638 crore in April-February 2018-19, according to the latest data from the Association of Mutual Funds in India (Amfi).
SIP continued to be the preferred route for retail investors to invest in mutual funds as it helps them reduce market timing risk, the industry body noted.
According to the data, SIP contribution in February stood at Rs 8,513 crore, which was higher than Rs 8,095 crore clocked in the same month last year.
However, the 44-player mutual fund industry, which mainly depends on SIPs for inflows in equity funds, saw a marginal drop in SIP investments as compared to the preceding month.
In January this year, the industry collected Rs 8,532 crore, while the SIP contribution in December stood at Rs 8,518 crore and Rs 8,273 crore in November.
Inflows into SIPs have averaged over Rs 8,200 crore for the 12 months till February.
Strong inflows through SIP route have also helped in raising investment in equity mutual funds to 11-month high of Rs 10,730 crore in February. This is the highest investment since March 2019, when equity schemes attracted an inflow to the tune of Rs 11,756 crore.
As the spread of coronavirus pandemic scared global equities, Indian stock market too found itself in the grip and registered a fall of almost 6.5 per cent (for S&P BSE 100) last month.
Market experts believe that positive inflow indicates building up of a positive investment trend.
“We expect continued buoyancy in SIP flows in March too, though a few institutional investors may reassess their investment strategy, given the deep correction in markets,” Amfi Chief Executive N S Venkatesh said.
”Individual investors continue to repose trust in the equity market, investing through mutual funds via the SIP route and I am happy to note that SIP monthly contributions have breached the Rs 8,000 crore mark for the 15th consecutive month,” he added.
In the past few years, investment through SIPs has been rising as an inflow of Rs 92,693 crore through the mode was seen in 2018-19, over Rs 67,000 crore in 2017-18 and more than Rs 43,900 crore in 2016-17.
Currently, mutual funds have 3.09 crore SIP accounts through which investors regularly invest in Indian mutual fund schemes.
The industry, on an average, added 9.95 lakh SIP accounts each month during the current financial year, with an average ticket size of Rs 2,750.
SIP is an investment vehicle that allows investors to invest in small amount periodically instead of lump sum payment. The frequency of investment is usually weekly, monthly or quarterly. It is similar to a recurring deposit where investors deposit a fixed amount every month.
Overall, mutual fund schemes witnessed an outflow of Rs 1,985 crore last month across all segments, mainly owing to withdrawal from liquid or money market segments.
The outflow has pulled down the asset base of the mutual fund sector to Rs 27.23 lakh crore at February-end from Rs 27.86 lakh crore at the end of January.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
