STRATEGIC RETREAT

VOLATILE TIMES ARE AN OPPORTUNITY FOR INVESTORS TO REVIEW THEIR FINANCIAL GOALS AND RISK TOLERANCE

- NACHIKET KELKAR

In the past few years, lakhs of Indians have piled in to mutual funds, hoping to ride the bull run in the stock markets. But, over the past few months, the bears have been in charge, with the markets spiralling down amid massive selling by foreign institutional investors in the wake of global trade and tariff uncertainties and the worries over tepid corporate earnings and slow economic growth.

As of March 13, the BSE Sensex was down more than 14 per cent from its peak. The mid and small-cap stocks have seen a sharper fall-the BSE Midcap index tumbled over 21 per cent from its high and the BSE Smallcap index slumped 24 per cent. With one-year returns from SIPS (systematic investment plans) flashing red, more investors seem to be hitting the pause.

Total inflows into equity mutual fund schemes in February were down 26 per cent at around *29,303 crore, compared with January (around 39,687.78 crore). The inflows in January itself were 4 per cent lower than December.

Midcap and smallcap schemes, which had been a big draw among investors, have seen around 34 per cent decline in flows month-onmonth. Sectoral/thematic category, which saw numerous scheme launches over the past 18 months, too, have seen a sizeable decline in flows-down 37 per cent from ₹9,016.60 crore to ₹5,711.58 crore.