Equity mutual fund inflows decreased by 9% in September, totaling ₹30,422 crore, compared to ₹33,430 crore in August, as investor sentiment turned cautious amid concerns over US trade tariffs.
In contrast, gold and silver exchange-traded funds (ETFs) experienced unprecedented inflows, reaching ₹8,363 crore for gold and ₹5,341 crore for silver, a notable increase from ₹2,190 crore and ₹1,760 crore respectively. This surge occurred despite challenges related to the global availability of physical bullion, according to data released by the Association of Mutual Funds in India.
Kotak Mutual Fund has suspended inflows into its Silver Fund of Funds due to significant market premiums stemming from the scarcity of physical silver. Venkat Chalasani, CEO of the Association of Mutual Funds in India (AMFI), noted that constraints in bullion supply are a global issue, compelling each fund house to develop strategies aligned with their internal risk management frameworks.
Market analysts believe that silver supply is becoming increasingly tight, driven by strong demand from individual investors and specific central banks incorporating silver into their forex reserves. Currently, the spot market price for silver is $50.41 per ounce, while futures are priced at $47.95, pointing to a short market supply, Chalasani added.
In equity funds, flexi cap funds attracted the largest inflow of ₹7,029 crore, while mid-cap and small-cap funds drew ₹5,085 crore and ₹4,363 crore respectively. In contrast, hybrid fund inflows declined to ₹9,398 crore from ₹15,294 crore, with notable investments seen in multi-asset allocation and balanced hybrid funds at ₹4,982 crore and ₹2,014 crore respectively.
Systematic Investment Plan (SIP) inflows reached a new high of ₹29,361 crore in September, up from ₹28,265 crore in August, with contributing accounts increasing to 9.25 crore from 8.99 crore. Overall, industry inflows were down ₹43,146 crore, as debt funds reported net outflows of ₹1.02 lakh crore.
Viraj Gandhi, CEO of Samco Mutual Fund, indicated that a slowdown in thematic fund collections and fewer new fund offers in this category were key factors contributing to the moderation in equity fund inflows. In September, thematic funds garnered only ₹1,221 crore, compared to a 12-month average inflow of ₹6,345 crore.
Nikunj Saraf, CEO of Choice Wealth, observed that after a period of heightened interest, investors appear to be reassessing their positions, booking partial profits while maintaining a fundamentally bullish outlook, as reflected in SIP contributions at all-time highs.
Naval Kagalwala, COO and Head of Products at Shriram Wealth, noted that most major debt categories, including Corporate Bond, PSU Debt, Floater, Gilt, and Short Duration, experienced outflows, likely due to recent interest rate cuts and diminished return forecasts.
Finally, the record inflows into gold and other ETFs, including silver, are attributed to a significant rise in gold and silver prices year-to-date.
Published on October 10, 2025.
