After facing redemption pressure during the second half of FY11, the mutual fund industry appears to have clawed its way back. Average assets under management have surged 6% in the April-June quarter after two straight quarters of decline. The largest domestic fund house ï¿½ Reliance Mutual Fund ï¿½ has, however, recorded a drop in its assets under management or AUM. Smaller fund houses such as Sahara, Baroda Pioneer and Taurus Mutual fund grew their AUM by more than 50%.
Equity markets remain under pressure, but rising interest rates have helped the industry mobilise funds with strong inflows into fixed maturity plans FMPs. In the quarter to June, mid-cap oriented schemes did better than their large-cap counterparts. On average, mid-cap funds generated an absolute three-month return of close to 2.1%. This even as the broader market indices like Sensex and Nifty fell 3% over the same period. However, certain diversified equity schemes clocked higher returns in the quarter.
News Source – ECONOMIC TIMES.
NEW FUND LAUNCH
Religare Mutual Fund launched Religare Fixed Maturity Plan – Series VIII – Plan A to F – Plan F (369 Days), a close ended income scheme. The new issue is open for subscription from 9th August and closes on 10th August 2011.
News Source – AMFI INDIA.
In a bid to attract foreign investments into the Indian equity markets at a time when panicky foreign institutional investors are pressing the sell button, the banking and markets regulators and the government have jointly taken a decision to allow non-resident investors to purchase on repatriation basis rupee denominated units of equity schemes of domestic mutual funds, subject to a ceiling of $13 billion.
News Source – BUSINESS LINE.
India on Tuesday allowed foreign investors to buy up to a cumulative $10 billion in domestic equity funds, opening the door wider to capital flows into an expanding economy. Qualified foreign investors, or QFIs, can also buy another $3 billion of debt funds that invest in at least 5-year infrastructure-related debt, the Securities and Exchange Board of India (SEBI) said.
News Source – HINDUSTAN TIMES.
Indian fund managers are again under pressure. Amid global turmoil and persistent fear of redemptions from domestic retail investors, fund houses are playing safe by increasing their cash holdings in equity schemes. Though the overall cash level till July is not available, equity experts say cash holdings are on the rise. According to fund managers Business Standard spoke to, cash exposure in some cases could be as high as 10-12 per cent.
News Source – BUSINESS STANDARD.