Foreign capital outflows have often sparked market downturns in India. But this dominance is diminishing, thanks to the growing counterweight of domestic inflows.
Domestic equity inflows are on an upswing with steadfast, long-term capital infusion by domestic investors, notably giants like the NPS and EPFO (provident fund body).
While the NPS has been investing in the top 200 companies, EPFO has made consistent investments in equity via Nifty and Sensex ETFs since 2015-16.
Institutional investors like the NPS and EPFO invest for the long haul, reducing the market's reliance on foreign money.
Moreover, monthly SIP inflows are nearing the Rs 20,000 crore mark – opening another front for consistent retail inflows.
Grab the latest edition of Mutual Fund Insight to track EPFO and NPS’s growing equity investments in recent years and how it reduces market volatility.