look news india
According to data from the Association of Mutual Funds in India (AMFI), as the stock market witnessed volatility due to the Lok Sabha elections in May, many retail investors stopped their systematic investment plans (SIPs). The stoppage ratio reached a record high of 88.4 per cent in May. Interestingly, the total SIP account figure has reached a new record high and the market is witnessing record SIP inflows on a monthly basis, even as the stoppage ratio is witnessing an increase.
According to the data, 49.7 crore new SIPs were registered in May. Whereas 43.9 crore SIPs were closed or terminated. That is, the ratio of stoppages to new leakages in May was 88.4 percent. There has been a significant increase in the ratio of May as compared to 52 percent in April and 54 percent in March. A look at the data of the last two years shows that the flow of investment has been towards small-caps, where many investors may have invested their money for fear of missing out on the market boom. Now if we are seeing high stoppages then it reflects the risk profile.
