According to an MF distributor who wishes to not to be named, while there has been a noticeable increase in people pausing or deferring their SIPs, the biggest reason is that SIPs are now made through the direct route and there is no one to hand-hold an investor.
But he is hopeful of the declining trend getting reversed sooner than later. “We still get some inquiries, albeit fewer than before, but we always approach clients by linking SIPs with their long-term financial goals.”
Similarly Amol Joshi of Planrupee Investments, also is bullish of the times ahead saying investors are actively rotating between different scheme categories rather than exiting the market as SIP investment has been made so easy now and people are now shifting their portfolios from say flexi-caps or large-caps from small and mid-caps, and vice versa.
“Despite SIP stoppages, inflows are steady near Rs 26,000 crore. Since the rupee inflows remains stable, it’s clear that investors are managing their portfolios more actively rather than exiting,” he says adding technology is playing a key role in making portfolio adjustments easier.
“Earlier, setting up an SIP took 15 days to a month; now, it’s done with a click. This has enabled investors to be more agile in portfolio management,” he says.
Despite market volatility, there are no signs of large-scale investor exits. “SIP data remains stable, and while equity net inflows are slightly lower, they still come in excess of Rs 29,000 crore. This is not indicative of mass exits rather a minor dip,” Joshi says.