India Post Daily

Renewing SIP investors outweigh those who are quitting: Data

<p>Recent research has shown that the number of participants enrolling in mutual fund systematic investment plans (SIPs) substantially exceeds the number of individuals terminating SIPs.</p>
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<p>The Association of Mutual Funds in India (AMFI) provided statistics showing that the SIP stoppage ratio, which indicates closed accounts under mutual fund SIPs compared to new openings, declined to a 27-month low in February, even as experts expressed caution regarding pricey stock valuation.</p>
<p>49.80 million new SIP accounts were opened in February, a 4% decrease from 51.84 million the previous month.</p>
<p>According to statistics, the number of discontinuations decreased by 10.3% throughout the period, from 21.33 million to 23.8 million.</p>
<p>The ratio of SIPs ceased when the proportion of newly registered SIPs recorded decreased to 42.83 percent in February from 46% in January, the slowest rate of increase since December 2021.</p>
<p>Analysts surmise that investors like diverse portfolios since they have seen sharp drops in the price of certain firms as a result of earnings surprises and regulatory measures.</p>
<p>And a mutual fund SIP enables them to do that. According to them, a lot of novice investors see mutual funds (MF) as a comparatively less hazardous way to invest in stocks than choosing individual shares.</p>
<p>Remarkably, the statistics showed that inflows into open-ended stock funds increased by 23% in February to Rs 26,865.78 crore, the highest level of positive equity fund flows since March 2021.</p>
<p>With 8.20 crore SIP accounts, systematic investment plans (SIPs) reached a record high of Rs 19,186 crore.</p>
<p>Net Assets under management (AUM) for the sector came to Rs 54,54,214.13 crore in February.</p>
<p>In addition, the AMFI has advised members to limit contributions to small and mid-cap funds in order to shield investors from a possible meltdown.</p>
<p>This request comes after a notice from SEBI, the market regulator for India, which also requires more disclosure of the risks connected to these products.</p>
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