Inflows into equity funds drop in Oct even as markets rally

Summary: Equity inflows slowed to Rs 24,690 crore in October despite a 4.5 per cent rise in the BSE Sensex, signalling profit booking after recent gains. SIP contributions, though, hit a record Rs 29,529 crore, while hybrid and gold ETFs added balance to overall flows.

Mutual fund inflows softened further in October 2025, even as the broader equity markets gained around 4.5 per cent during the month, suggesting that some investors may have booked profits after the recent rally.

Equity schemes saw moderation in inflows for the fourth consecutive month, though hybrid funds showed signs of recovery.

According to data from the Association of Mutual Funds in India (AMFI), equity-oriented schemes logged net inflows of Rs 24,690 crore in October, down from Rs 30,421 crore in September. That said, SIP contributions climbed to Rs 29,529 crore, the highest monthly figure yet, signalling that investors are relying on systematic investing rather than lump-sum bets.

Despite the cool-off, October marked the 56th consecutive month of positive equity flows since March 2021, underscoring investors’ continued preference for mutual funds as a long-term savings vehicle.

Which fund categories got the most attention?

Within equities, flexi-cap funds topped the charts with Rs 8,928 crore inflows, followed by mid-cap (Rs 3,807 crore) and small-cap (Rs 3,476 crore) schemes. Sectoral and thematic funds saw inflows of Rs 1,366 crore and multi-cap funds received about Rs 2,500 crore of investments in October.

While equity funds saw cooler returns, hybrid schemes saw a surge in collections, garnering Rs 14,156 crore in October versus Rs 9,397 crore in September, led by multi-asset and arbitrage strategies. Balanced-advantage funds also remained steady, suggesting investors are using hybrids as a bridge between equity optimism and risk management.

Debt funds also posted a sharp rebound with Rs 1.59 lakh crore in net inflows, reversing September’s heavy redemptions. Liquid and overnight funds led the recovery, signalling the cyclical return of institutional funds after quarter-end withdrawals.

Gold exchange-traded funds (ETFs), meanwhile, experienced a slight dip, with net inflows of Rs 7,743 crore in October compared to Rs 8,363 crore in September. Even silver ETFs have seen net inflows of Rs 3,412 crore in October. This comes at a time when both gold and silver funds delivered around 4.5 per cent last month.

Also read: Mutual fund flows continue to slide; gold ETFs sparkle