Small Cap, Multi, Mid, Index to Tax Saving ELSS funds: Most-favoured mutual fund schemes in 2023

AMFI January 2023 Data: Small Cap, Multi Cap, Mid Cap, Large & Mid Cap, Index and ELSS funds were the most favoured equity mutual fund schemes attracting the highest investments in January 2023. Among Hybrid schemes, Multi-Asset and Arbitrage funds witnessed big inflows.

Data shows that mutual fund inflows remained robust in the first month of the new year 2023 with equity and index schemes being the preferred pick for investors. According to the January 2023 Mutual Fund data by the Association of Mutual Funds in India (AMFI, various equity/growth-oriented schemes witnessed a net inflow of Rs 12,546.51 crore with most investments in Multi Cap, Large & Mid Cap, Mid Cap, Small Cap, ELSS and Flexi Cap funds.

In the Hybrid Schemes category, Multi-Asset Allocation funds witnessed a net inflow of Rs 2181.69 crore and Arbitrage Funds witnessed an inflow of Rs 2054 crore. Index Funds witnessed a net inflow of Rs 5813.16 crore.

“There has been an overall growth momentum observed in mutual fund folios. January 2023 data showcases a positive trend in the Equity Mutual Fund inflows. Small Caps have witnessed inflows, majorly driven by the retail investors as their investment is for long-term return cycle,” said N S Venkatesh, Chief Executive, AMFI.

“Encouraging SIP numbers indicates retail investors’ trust in Mutual Funds. We believe that SIP inflow momentum has and will continue to balance the FII outflows in the market. The importance of investing in equity markets for the long term goals through SIP as a goal-linked route to create wealth is gaining awareness. This month almost 23 lacs new SIPs were registered, which shows increasing investor belief in the instrument,” he added.

Also Read: What AMFI’s December 2022 data says about mutual funds and what should investors do in 2023

While equity schemes and index funds witnessed the most investments, Gold ETFs and other ETFs witnessed an outflow of Rs 199.43 crore and Rs 1708.96 crore respectively.

Commenting on the latest AMFI data, Gopal Kavalireddi, Head of Research at FYERS, said, “After three months of decreasing net flows, equity category flows were higher than the Rs.10,000 crore mark. Despite the volatility in stock markets, investors continue to repose faith in equity mutual funds, as evidenced by the Rs.12,546 crore of net inflows in January, a 72 per cent rise compared to an m-o-m basis. Smallcap (Rs.2,255 crore), Midcap (Rs.1,962 crore), and Large & Midcap (Rs.1,902 crore) mutual fund schemes were the preferred categories for investors. As the Nifty Small Cap index underperformed the Nifty 50 index by more than 13 per cent since January 2022, value has emerged in Smallcap stocks.”

AMFI January 2023 Data: Equity and Index Schemes

  • Multi Cap Funds witnessed a net inflow of Rs 1773.02 crore in January 2023.
  • Large Cap Funds witnessed a net inflow of Rs 715.98 crore in January 2023.
  • Large & Mid Cap Funds witnessed a net inflow of Rs 1909.02 crore in January 2023.
  • Mid Cap Funds witnessed a net inflow of Rs 1628.06 crore in January 2023.
  • Small Cap Funds witnessed a net inflow of Rs 2255.85 crore in January 2023.
  • Dividend Yield Funds witnessed a net inflow of Rs 2.18 crore in January 2023.
  • Value Fund/Contra Funds witnessed a net inflow of Rs 763.29 crore in January 2023.
  • Focussed Funds witnessed a net inflow of Rs 183.31 crore in January 2023.
  • Sectoral/Thematic Funds witnessed a net inflow of Rs 903.19 crore in January 2023.
  • Tax-saving ELSS Funds witnessed a net inflow of Rs 1214 crore in January 2023.
  • Flexi Cap Funds witnessed a net inflow of Rs 1005.62 crore in January 2023.
  • Index Funds witnessed a net inflow of Rs 5813.16 crore in January 2023.

Hybrid Schemes Find Support Amid Rate Hikes

With the interest rate hike cycle still in progress, hybrid funds continue to find support, with a net flow of Rs.4,491 crore in January, doubling down on the flows of last month, said Kavalireddi said.

Multi-Asset and Arbitrage funds saw net flows of Rs.2182 crore and Rs.2,055 crore. However, Index fund flows dominate all equity flows, with an Rs.5,813 crore net flow in the month, he added.

Also Read: Best Small Cap Funds (January 2023): Top 10 Schemes

The net flows into the industry stood at Rs.11,373 crore, a 153% rise month-on-month (m-o-m). As a category, debt funds continue to witness negative net flows to the tune of Rs.10,315 crore, with the highest outflows from liquid funds (Rs.5,042 crore) and best inflows into money market funds (Rs.6460 crore).

(Disclaimer: The above content is for information purposes only. Mutual Fund investments are subject to market risks with no assurance or guarantee of return on investments. Please consult your financial advisor before making an investment decision)