Retail investors pull back as markets remain flat; net inflows fell 90%

Retail investors sharply reduce direct equity exposure in 2025, preferring mutual funds and DIIs as market volatility and weak returns weigh on sentiment

With the equity market turning tumultuous, retail investors have sharply scaled back their direct equity investments, even as they steadily shift from traditional savings instruments to equities via mutual funds (MFs).

 

So far in 2025, net inflows from retail investors have totalled ₹12,408 crore, down nearly 90 per cent from ₹1.16 trillion in the January–September 2024 period.

 

The retreat from direct investing contrasts with the strong inflows from domestic institutional investors (DIIs), led by MFs. Other DIIs include insurance companies and pension funds, which channel retail money through systematic investment plans, insurance premiums, and retirement savings schemes.

 

Experts say that