MFs see 2% asset erosion due to volatile markets
10 Dec 2011
The Indian asset management industry witnessed a value erosion of 2 per cent in its monthly assets due to the volatile conditions in the equity markets, according to credit ratings agency Crisil.
As a result, the month-end asset value of the industry declined toRs 6.82 lakh crore in November, despite an inflow of around Rs38,000 crore into the segment during the month.
"The fall in assets worth Rs13,800 crore was primarily due to mark-to-market losses in the equity category, which declined by Rs15,000 crore in the month," Crisil said in a report released on Friday.
Data of the Association of Mutual Funds in India (AMFI), also released on Friday, also showed equity funds seeing a sharper decline of 8 per cent or Rs15,000 crore in the asset value to Rs1.7 lakh crore due to a steep fall in the underlying equity markets in the month.
In the last three months, equity schemes saw inflows of over Rs3,500 crore, largely through systematic investment plans (SIP). The average assets under management (AAUM) for the industry in November stood at over Rs6.81 lakh crore, down 2 per cent from the October figure of Rs6.95 lakh crore.
During November, the NSE benchmark index Nifty fell around 9 per cent due to weak global cues and the resultant downbeat domestic sentiment. The category also witnessed marginal outflows of Rs5 crore in the month for first time in four months, Crisil said.
Significantly, despite the rise in prices of the yellow metal, gold ETFs saw outflows for the first time in 18 months, the report said. The category registered outflows of Rs22 crore in the month compared to inflows of Rs455 crore in October.
The 50 fixed income plans launched during the month amassed Rs8,900 crore, while other debt and equity schemes garnered just Rs100 crore during the period under review.
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