Market meltdown to weigh on equity flows, dent financial health of MF firms

The improvement in equity flows in recent months may reverse, with mutual fund (MF) players expecting slowdown in fresh equity flows as markets continue their downward trajectory amid Coronavirus scare.

“While so far redemptions have not picked up, fresh flows will come under pressure if market correction deepens further,” said Nithin Kamath, founder and chief executive officer of Zerodha, which runs the MF platform Coin.

According to market participants, MF investors could decide to sit on the sidelines as several equity schemes have seen their net asset values (NAVs) dip sharply in February.