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Equity MFs add folios at faster pace in Feb


ET Intelligence Group: New folios for equity mutual funds continued to increase in February, helped by sustained momentum in the large-cap, large & midcap, and mid-cap fund categories. This was despite a contraction in the net inflow in equity funds for the past eight months, according to the data from the Association of Mutual Funds in India (AMFI).

Equity funds added 3.4 lakh folios in February compared with the one-year average of 2.6 lakh. The number has risen for three consecutive months taking the total tally to 6.5 crore, which is nearly 67 per cent of the total mutual fund folio count.

Folios are numbers designated to individual investor accounts with a fund house. An investor can have multiple folios.

The large-cap category reported 77,232 new folios in February 2021, which was 49 per cent higher than the one-year average addition. The category contributes 16.1 per cent to the total equity accounts and forms 18 per cent of the assets under management (AUM) for equity funds.

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For the mid-cap category, the folio addition at 56,107 was five times higher than the one-year average addition. It contributed 11 per cent to the equity AUM and the equity folio count. In the case of the large- & mid-cap category, the addition was 135 per cent higher than the one-year average for the category.

The reason for the outflow from equity funds is due to a significant redemption from flexi-cap funds, a newly introduced category by the market regulator Sebi in December 2020.

There were 35 multi-cap schemes in November 2020, of which 10 continue to remain multi-cap in February 2021, while the remaining 25 were converted into flexi-cap schemes. With an AUM of 1.6 lakh crore in February, the flexi-cap category is the second-largest equity category after the large-cap segment.





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