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Economic Times
12-06-2025
- Business
- Economic Times
Lumpsum vs SIP: Is caution killing the case for lumpsum?
Mutual fund SIP inflows hit record highs in May amid market rally. Investors are cautious about lumpsum investments due to geopolitical tensions and slowdown fears. Vishal Dhawan suggests hybrid equity funds for lumpsum investments. Equity mutual fund inflows dropped, while hybrid funds saw increased interest. Overall mutual fund inflows decreased, but total assets under management grew. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads With mutual fund SIP inflows reaching record highs in May amid a market rally, a key question arises: Why are investors moving away from lumpsum investments? An expert explains that geopolitical tensions, trade concerns, and fears of a global slowdown—along with muted earnings and valuation worries—have made investors more cautious about lumpsum investing.'A combination of geopolitical uncertainty, trade wars, and fears of a global slowdown have made investors less confident about investing in lumpsums and more inclined towards SIPs in the current environment. Additionally, the slowdown in corporate earnings and concerns over the valuations of mid- and small-cap stocks are pushing investors to prefer SIPs as their investment strategy,' said Vishal Dhawan, CEO of Plan Ahead Wealth Advisors, a Mumbai-based wealth management firm, in a conversation with May, mutual fund SIP inflows rose marginally by 0.21% to Rs 26,688 crore, compared to Rs 26,632 crore in April. On a yearly basis, SIP inflows have surged nearly 28% from Rs 20,904 crore in May the current financial year so far, total SIP contributions by investors stand at approximately Rs 53,320 crore. For the calendar year to date, total SIP contributions have reached nearly Rs 1.31 lakh crore, up from Rs 98,571 crore during the same period last benchmark indices—Nifty50 and BSE Sensex—are down about 4% from their 52-week highs. With markets hovering near record levels, is the fear of buying at the peak discouraging lumpsum investments?Addressing the trend, Dhawan noted that investors often anchor to index highs, and their past experience of corrections from those levels tends to impact their willingness to invest in to the latest monthly data from the Association of Mutual Funds in India ( AMFI ), equity mutual funds witnessed a 22% drop in monthly inflows, receiving Rs 19,013 crore in May compared to Rs 24,269 crore in mutual funds saw an outflow of Rs 15,908 crore in May, a sharp reversal from the inflow of Rs 2.19 lakh crore in April. Meanwhile, hybrid mutual funds attracted higher inflows than equity mutual funds in May, with inflows rising 46% to Rs 20,765 crore from Rs 14,247 crore in funds saw a steep 73% decline in monthly inflows, receiving Rs 5,525 crore in May compared to Rs 20,229 crore in April. Different mutual fund categories showed mixed trends, with some attracting investor interest while others witnessed a advises that investors can still consider lumpsum investments in the current environment through hybrid equity funds, multi-asset funds, balanced advantage funds, and equity savings mutual fund inflows dropped by 89% in May. However, total assets under management (AUM) grew 3%, rising to Rs 71.93 lakh crore in May from Rs 69.73 lakh crore in April.
Time of India
12-06-2025
- Business
- Time of India
Lumpsum vs SIP: Is caution killing the case for lumpsum?
With mutual fund SIP inflows reaching record highs in May amid a market rally, a key question arises: Why are investors moving away from lumpsum investments? An expert explains that geopolitical tensions, trade concerns, and fears of a global slowdown—along with muted earnings and valuation worries—have made investors more cautious about lumpsum investing. 'A combination of geopolitical uncertainty, trade wars, and fears of a global slowdown have made investors less confident about investing in lumpsums and more inclined towards SIPs in the current environment. Additionally, the slowdown in corporate earnings and concerns over the valuations of mid- and small-cap stocks are pushing investors to prefer SIPs as their investment strategy,' said Vishal Dhawan, CEO of Plan Ahead Wealth Advisors, a Mumbai-based wealth management firm, in a conversation with ETMutualFunds. Also Read | Mutual fund SIP inflows at record high, rise marginally to Rs 26,688 crore Best MF to invest Looking for the best mutual funds to invest? Here are our recommendations. View Details » In May, mutual fund SIP inflows rose marginally by 0.21% to Rs 26,688 crore, compared to Rs 26,632 crore in April. On a yearly basis, SIP inflows have surged nearly 28% from Rs 20,904 crore in May 2024. In the current financial year so far, total SIP contributions by investors stand at approximately Rs 53,320 crore. For the calendar year to date, total SIP contributions have reached nearly Rs 1.31 lakh crore, up from Rs 98,571 crore during the same period last year. Live Events The benchmark indices—Nifty50 and BSE Sensex—are down about 4% from their 52-week highs. With markets hovering near record levels, is the fear of buying at the peak discouraging lumpsum investments? Addressing the trend, Dhawan noted that investors often anchor to index highs, and their past experience of corrections from those levels tends to impact their willingness to invest in lumpsums. According to the latest monthly data from the Association of Mutual Funds in India ( AMFI ), equity mutual funds witnessed a 22% drop in monthly inflows, receiving Rs 19,013 crore in May compared to Rs 24,269 crore in April. Debt mutual funds saw an outflow of Rs 15,908 crore in May, a sharp reversal from the inflow of Rs 2.19 lakh crore in April. Meanwhile, hybrid mutual funds attracted higher inflows than equity mutual funds in May, with inflows rising 46% to Rs 20,765 crore from Rs 14,247 crore in April. Also Read | Midcap mutual funds deliver 19% return in 3 months. Check top performers Passive funds saw a steep 73% decline in monthly inflows, receiving Rs 5,525 crore in May compared to Rs 20,229 crore in April. Different mutual fund categories showed mixed trends, with some attracting investor interest while others witnessed a decline. Dhawan advises that investors can still consider lumpsum investments in the current environment through hybrid equity funds, multi-asset funds, balanced advantage funds, and equity savings funds. Overall mutual fund inflows dropped by 89% in May. However, total assets under management (AUM) grew 3%, rising to Rs 71.93 lakh crore in May from Rs 69.73 lakh crore in April.
Time of India
10-06-2025
- Business
- Time of India
Nifty Bank hits 57,000. Is it time for mutual fund investors to bet on banking funds?
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads With Nifty Bank crossing the 57,000 mark to hit 57,049 on Monday, a market expert mentioned that the recent rally has been fueled by robust earnings growth, improved asset quality, and attractive valuations in the banking sector. Banks are now seen as reasonably valued, offering a margin of safety for investors.'If you look at the numbers, the banking sector's Q4 consolidated net profit stood at a historically higher level. Notably, bank earnings contributed over a third of all listed companies' total profits. Furthermore, Net Non-Performing Assets (NNPA) are at historic lows,' Vishal Dhawan, CEO, Plan Ahead Wealth Advisors, a wealth management firm in Mumbai, shared with ETMutualFunds 'Tax and interest rate cuts are likely to boost consumption, credit demand is expected to rise. Higher consumption could drive stronger loan disbursements,' he banking index closed at 56,839, down marginally by 0.37% from the day's high level. The Nifty Bank index has surged by 16.66% in the last three months, whereas it went up by 5.73% in the last six the last year, the banking index has gained 13.60%, and in the current calendar year, it has gone up by 11.24%.Commenting on current allocations to banking and financial sector funds, the expert suggests that aggressive investors may consider a 5–10% exposure. However, they emphasise that diversified equity funds remain a more resilient choice for most investors, given their broader exposure across sectors, market capitalisations, and geographies, which helps mitigate market volatility.'For aggressive investors, one can take exposure to thematic funds from 5% to 10%. That's because themes are cyclical and very hard to time correctly; getting in or out at the wrong moment could significantly impact the entire portfolio,' Dhawan told ETMutualFunds.'Diversified equity funds, by contrast, are much better at weathering market swings due to their broader exposure across different sectors, market caps, and geographies. Remember, diversification is key for long-term growth,' he are around 21 actively managed mutual funds focused on the banking and financial services sector, which have delivered an average return of 10.67% so far in the current calendar year — the only category to post double-digit gains during this Banking & Financial Services Fund offered the highest return of around 14.07% in 2025 so far. Helios Financial Services Fund offered the lowest return of around 6.68% in the same defined the passive side, 20 funds benchmarked to the Nifty Bank index delivered an average return of 11.22% so far this calendar year. Among them, the UTI Nifty Bank ETF posted the highest return at 11.39%, while the Bandhan Nifty Bank Index Fund recorded the lowest at around 10.90%.While choosing between active or passive funds focused on the banking sector, Dhawan recommends opting for an active fund, citing the fund manager's ability to navigate market cycles and selectively allocate to high-conviction banking and financial stocks as a key advantage over passive strategies.'The Bank Nifty largely comprises private and public sector banks. This means it offers little to other important financial sectors like insurance companies and Non-Banking Financial Companies (NBFCs). If you rely only on the Bank Nifty to represent the entire financial sector, you could miss out on opportunities that may emerge from other financial sectors, like insurance or NBFCs, that may offer better fundamentals. Thus, an active fund may be preferred,' Dhawan shared with to a report by ETMarkets, high-weighted financials and private banks led the gains on Monday, lifting the Bank Nifty to a record high of 57,049.50 — its first-ever close above the 57,000 mark — as investors welcomed the Reserve Bank of India 's surprise rate cut and a shift to a neutral policy stance aimed at boosting credit growth and bank Reserve Bank of India on Friday slashed the repo rate by 50 basis points to 5.5% and gave a 100 basis point CRR cut, to which Dhawan expects that this aims to boost liquidity and support growth and banks may face short-term margin pressure, as lending rates fall faster than deposit rates adjust and also margins (NIMs) may bottom out in Q2FY26, with recovery expected as deposit rates decline gradually.'Liquidity infusion from the CRR cut (Rs 2.5 trillion) will lower funding costs and boost loan growth. Overall, the outlook remains stable to positive for well-managed banks,' Dhawan further should always invest based on their risk appetite, investment horizon, and goals.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle
Economic Times
10-06-2025
- Business
- Economic Times
Nifty Bank hits 57,000. Is it time for mutual fund investors to bet on banking funds?
With Nifty Bank crossing the 57,000 mark to hit 57,049 on Monday, a market expert mentioned that the recent rally has been fueled by robust earnings growth, improved asset quality, and attractive valuations in the banking sector. Banks are now seen as reasonably valued, offering a margin of safety for investors. ADVERTISEMENT 'If you look at the numbers, the banking sector's Q4 consolidated net profit stood at a historically higher level. Notably, bank earnings contributed over a third of all listed companies' total profits. Furthermore, Net Non-Performing Assets (NNPA) are at historic lows,' Vishal Dhawan, CEO, Plan Ahead Wealth Advisors, a wealth management firm in Mumbai, shared with ETMutualFunds. Also Read | 3 equity mutual fund categories lose up to 7% in 2025. Expert shares what went wrong 'Tax and interest rate cuts are likely to boost consumption, credit demand is expected to rise. Higher consumption could drive stronger loan disbursements,' he added. The banking index closed at 56,839, down marginally by 0.37% from the day's high level. The Nifty Bank index has surged by 16.66% in the last three months, whereas it went up by 5.73% in the last six months. In the last year, the banking index has gained 13.60%, and in the current calendar year, it has gone up by 11.24%. ADVERTISEMENT Commenting on current allocations to banking and financial sector funds, the expert suggests that aggressive investors may consider a 5–10% exposure. However, they emphasise that diversified equity funds remain a more resilient choice for most investors, given their broader exposure across sectors, market capitalisations, and geographies, which helps mitigate market volatility.'For aggressive investors, one can take exposure to thematic funds from 5% to 10%. That's because themes are cyclical and very hard to time correctly; getting in or out at the wrong moment could significantly impact the entire portfolio,' Dhawan told ETMutualFunds. ADVERTISEMENT 'Diversified equity funds, by contrast, are much better at weathering market swings due to their broader exposure across different sectors, market caps, and geographies. Remember, diversification is key for long-term growth,' he are around 21 actively managed mutual funds focused on the banking and financial services sector, which have delivered an average return of 10.67% so far in the current calendar year — the only category to post double-digit gains during this period. ADVERTISEMENT DSP Banking & Financial Services Fund offered the highest return of around 14.07% in 2025 so far. Helios Financial Services Fund offered the lowest return of around 6.68% in the same defined period. Also Read | 30 equity mutual funds down by over 10% from their 52-week high NAVs On the passive side, 20 funds benchmarked to the Nifty Bank index delivered an average return of 11.22% so far this calendar year. Among them, the UTI Nifty Bank ETF posted the highest return at 11.39%, while the Bandhan Nifty Bank Index Fund recorded the lowest at around 10.90%. ADVERTISEMENT While choosing between active or passive funds focused on the banking sector, Dhawan recommends opting for an active fund, citing the fund manager's ability to navigate market cycles and selectively allocate to high-conviction banking and financial stocks as a key advantage over passive strategies. 'The Bank Nifty largely comprises private and public sector banks. This means it offers little to other important financial sectors like insurance companies and Non-Banking Financial Companies (NBFCs). If you rely only on the Bank Nifty to represent the entire financial sector, you could miss out on opportunities that may emerge from other financial sectors, like insurance or NBFCs, that may offer better fundamentals. Thus, an active fund may be preferred,' Dhawan shared with ETMutualFunds. According to a report by ETMarkets, high-weighted financials and private banks led the gains on Monday, lifting the Bank Nifty to a record high of 57,049.50 — its first-ever close above the 57,000 mark — as investors welcomed the Reserve Bank of India's surprise rate cut and a shift to a neutral policy stance aimed at boosting credit growth and bank profitability. The Reserve Bank of India on Friday slashed the repo rate by 50 basis points to 5.5% and gave a 100 basis point CRR cut, to which Dhawan expects that this aims to boost liquidity and support growth and banks may face short-term margin pressure, as lending rates fall faster than deposit rates adjust and also margins (NIMs) may bottom out in Q2FY26, with recovery expected as deposit rates decline gradually. Also Read | JioBlackRock Mutual Fund launches website, unveils leadership team and early access initiative 'Liquidity infusion from the CRR cut (Rs 2.5 trillion) will lower funding costs and boost loan growth. Overall, the outlook remains stable to positive for well-managed banks,' Dhawan further should always invest based on their risk appetite, investment horizon, and goals. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times) If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle Page 2
Time of India
02-06-2025
- Business
- Time of India
Volatile Markets and SIPs: What should mutual fund investors do?
Live Events Amid a volatile market , many investors are questioning whether they should continue their Systematic Investment Plans (SIPs) or pause until stability returns. However, market experts recommend continuing SIPs, citing reasons such as attractive valuations, lower average purchase prices, the benefits of habit formation, the impossibility of timing the market, and the long-term advantages of compounding.'When equity markets fall, valuations also fall, making investments at a lower price more attractive; therefore, when the market falls, it is the best time to continue SIP, discontinuing SIPs can hamper the investors' ability to save and invest, and take away the discipline of long term investing, the investor thinks that he/she can enter again or restart at lower prices, but it's not always possible, and lastly the whole idea of a SIP is to do away with market timing speculation and stopping a SIP can disrupt the process of compounding,' Vishal Dhawan, CEO, Plan Ahead Wealth Advisors, a wealth management firm in Mumbai told ETMutualFunds He added that since equity investing is aimed at long-term compounding benefits, one can start SIPs at any time. However, while markets have recovered from their recent lows, periods of market decline typically lead to more attractive valuations. Investing more during such times—when markets are not at their peak—increases the probability of achieving superior long-term returns. 'So, depending on cash flow surpluses, there is a need to try to have a significant portion of the cash flow surpluses going through SIPs ideally.'Another expert cited studies which show that investors' returns and market returns are not the same. This is because an investor is either entering or exiting the market at the wrong time. To achieve their goals, one needs to give time and be patient. That's what SIPs do: help you achieve your goals in a disciplined manner over periods of time.'In the journey, there will always be short-term hiccups, but staying focused on your investments is the only way to achieve your goals,' said Manish Mehta, Joint President & National Head –Sales, Digital Business & Marketing, Kotak Mutual Fund , shared with far in the current calendar year, the benchmark indices — BSE Sensex and Nifty50 — have gained 4.23% and 4.67%, respectively. Over the past three months, they have risen by 11.27% and 11.86%, respectively, while over the last nine months, they have declined by 1.11% and 1.92%, May, Nifty50 breached the 25,000 mark for three days. On May 26, Nifty 50 closed up by nearly 13% from April's low level, and as the benchmark index scales up, many market experts recommend that investors continue with their SIPs, whereas they should stay cautious while doing lump-sum investments and should try to stagger their an addition to this, Dhawan recommends that currently, valuations are above their long-term averages, especially in the case of mid and small caps, and thus it is preferred to invest through SIPs/STPs. 'However, the ongoing volatility driven by global trade wars and cross-border tensions could present sudden opportunities. Market corrections can be sharp, so it's wise to be prepared for lump-sum investing, besides continuing with SIPs,' he further shared with the other hand, Mehta recommends that STP is suited when one has some money available for lumpsum investment but varies with market fluctuations and in this case one can park the money in a fixed income scheme and do a STP with a duration of their choice plus if an investor plans to invest out of a regular income stream then SIP fits the requirement where in a disciplined manner one can regularly keep looked at the performance of equity mutual fund categories since the April low and found that out of 21 categories, 19 offered double-digit average returns, and two, pharma and consumption-based funds, gave single-digit returns in the same time frameSince April 7, the Auto sector-based funds offered an average return of 19.13%. Technology-based funds gave a 17.44% average return in the same period. International funds gave 16.83% and infrastructure funds delivered 15.95% average return in the same and small-cap funds gave 15.86% and 16.42% respectively since April's low level. Contra and large-cap funds were last in the list of double-digit gainers. The categories gave 11.92% and 11.03% respectively in the mentioned the categories gain since April's low and the market being still volatile, Mehta recommends that long term wealth creation can happen through regular investments in equity oriented schemes to support which there is enough historical data to demonstrate long term wealth creation through equity schemes and since SIPs are recommended over longer time horizons, investments in multicap / flexicap / large and midcap kind of to a release by Motilal Oswal Private Wealth, large-cap valuations are now around their 10-year average, while mid- and small-caps still trade at a premium, though select opportunities further shared with ETMutualFunds that currently, large-cap stocks offer attractive valuations compared to small and mid-caps, which makes them a smart starting point for SIPs (Systematic Investment Plans), especially in funds that are currently overweight in the large-cap category, and these funds are also safer for new adds that different assets perform well in different timeframes; therefore, your portfolio should include multi-asset funds. Geographical diversification is crucial for any robust portfolio, so consider adding global or international funds to reduce reliance on the domestic market and gain exposure to different economies and currencies. Additionally, under debt funds, one can consider short-term funds for short-term goals and long-term funds to take duration exposure, and for those in higher tax brackets, equity savings and arbitrage funds offer good options for short-term fund parking, he informed should always choose a scheme based on risk appetite, investment horizon, and goals.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)If you have any mutual fund queries, message on ET Mutual Funds on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on ETMFqueries@ alongwith your age, risk profile, and Twitter handle.
