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Market correction halts MF asset gains; average AUM dips 1.7% in Q4

Average quarterly AUM fell 1.7 per cent in Q4

Mutual funds (MFs) are gearing up with offerings centered on the ‘quality’ theme, as this investment approach is expected to rebound following three years of underperformance compared to the ‘value’ theme.
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The mark-to-market impact of MF AUM was cushioned to an extent by fresh investments. Investors poured in a net ₹2.3 trillion into MF schemes in the first two months of Q4.

Abhishek Kumar Mumbai

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The sharp correction in the equity market that started in September 2024 halted a 10-quarter streak of asset growth for mutual funds (MFs) in the January-March quarter (Q4) of 2024-25 (FY25). 
Assets under management (AUM) of MFs fell from ₹68.6 trillion in the previous quarter to ₹67.4 trillion in Q4FY25, a decline of 1.7 per cent. 
MF assets fluctuate on the basis of two key factors: net inflows and outflows and the mark-to-market impact of market movements on underlying assets. 
With 54 per cent of MF AUM invested in domestic equity-oriented schemes (active and passive) as of February, equity market