July 2017

2

Jul
18

Dear Friends,

The Indian equity indices have reached new highs as the Goods and Services Tax (GST) from July 1 has taken effect. Markets continue to be fuelled by domestic inflows on the back of a good start to the monsoon season and probable benefits on domestic consumption due to GST.

The mutual fund industry’s asset base rose 7% this quarter driven largely by strong retail participation in SIPs. Non-metros (B-15 locations) continued to outpace the top cities (T- 15 locations) during this time with more allocations through SIPs. These markets will be the bedrock of the growth of the industry as the benefits of the country’s growth and policies lead to increase in income and savings levels. Net investments by mutual fund houses have been twice the amount of FIIs, around Rs. 29,000 crore, in the first quarter of the current financial year buoyed by the strong inflows. As the SIP flows are now sustainably over Rs. 4,000 crore, the fund houses will continue to provide some stability vis-à-vis FIIs while seeking the right opportunities as markets reach new highs. A lot of investors might be looking at markets levels right now and wondering whether it is the right time to invest. This indecision is compounded when taking into consideration the falling interest rates for small savings schemes like NSC; PPF etc. For many their investment plans will need a re-look. Mutual Funds fit in well here. For those have a low risk appetite or who are nearing retirement, debt-based mutual funds or hybrid funds which have a lower equity allocation work well to provide better inflation-adjusted returns. As always, before you make a decision on an investment do consult afinancial/tax advisor to see how it compares with other options but rest assured whatever your goals are there is a mutual fund scheme for you. And, many facilities like Systematic Transfer Plans, Systematic Withdrawal Plans and Triggers make it more convenient for you to invest.

Finally, I am pleased to share with you that SBI Mutual Fund completed 30 years of operations on June 29, 2017. Since 1987, the company’s mission has been to help investors achieve their financial goals by providing class leading products and services. Being a part of State Bank of India, we are proud of our parentage and the joint venture with AMUNDI, Europe’s largest investment manager, helps us bring best-in-class practices to our risk management, research and investment processes. We have been part of many firsts in the industry, possible due to the unflinching support of our partners, investors and employees. While 30 amazing years are behind us, your trust in us continues to strengthen our resolve to make the next 30 years even better.

Warm Regards,

Anuradha Rao

Managing Director & CEO

 

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