India’s Mutual Fund Momentum Stays Strong as SIPs, Gold and Silver ETFs Reach Record Highs
Mumbai – Despite a slight moderation in equity mutual fund inflows, India’s investment landscape remained resilient in September, showcasing the strength and confidence of domestic investors.
The latest data from the Association of Mutual Funds in India (AMFI) highlights how steady Systematic Investment Plan (SIP) contributions and record-breaking inflows into gold and silver exchange-traded funds (ETFs) underscored a healthy and diversified investment sentiment across the country.
In September, inflows into India’s equity mutual funds eased by 9% month-on-month to ₹304.22 billion ($3.44 billion), mainly due to a slowdown in sectoral and thematic funds.
However, this moderation was more than balanced by record highs in SIP investments, signaling that long-term retail investors continue to show unwavering faith in India’s equity markets.
SIPs Hit an All-Time High
Systematic Investment Plans — one of the most popular investment routes for retail investors — saw contributions surge by 4.2% to ₹294.61 billion, marking an all-time high.
steady inflow not only cushioned the impact of a $2.7 billion sell-off by foreign investors but also helped sustain market stability. The benchmark Nifty 50 index rose by 0.75% in September, reflecting strong domestic participation even amid global uncertainties.
According to Anand Vardarajan, Chief Business Officer at Tata Asset Management, “It’s heartening to see equity flows remain resilient even as IPO activity stayed strong through September.”
This resilience reinforces India’s growing retail investor base and their commitment to long-term wealth creation through disciplined investing.
Steady Confidence in Equities
Equity mutual funds have now seen continuous monthly inflows since February 2021, backed by structural economic reforms, supportive monetary policies, and India’s robust growth outlook.
While the pace of inflows may have softened, experts emphasize that investor sentiment remains strong.
Nehal Meshram, Senior Analyst at Morningstar Investment Research India, stated, “The trend reflects solid investor confidence, supported by consistent SIP contributions and robust retail participation.”
The continued inflow streak illustrates the enduring appeal of equity investments as a vehicle for long-term financial growth.
Among equity categories, multi-cap funds performed well, with inflows rising by 11.5% to ₹35.6 billion, reflecting investors’ preference for diversified exposure across large, mid, and small-cap stocks.
While small-cap and mid-cap funds saw minor dips of 12.6% and 4.6%, respectively, the overall pattern indicated portfolio balancing rather than withdrawal of confidence. Large-cap funds saw inflows of ₹23.19 billion, down slightly by 18.2%, but still maintained steady participation.
Sectoral and Thematic Funds Adjust
Sectoral and thematic funds — which often attract investors seeking high-growth themes — saw inflows decline by 69% to ₹12.21 billion. This was largely due to fewer new fund launches, with only one in September compared to two in August. Analysts noted that this dip is temporary and reflects market consolidation rather than investor hesitation.
Record Inflows into Gold and Silver ETFs
One of the most positive highlights of September was the record-breaking inflows into gold and silver ETFs. Investors poured ₹83.63 billion into gold ETFs and ₹53.42 billion into silver ETFs, marking historic highs.
This shift reflects growing interest in precious metals as a hedge against market volatility and inflation, especially ahead of the Diwali festive season, when demand for gold and silver traditionally peaks in India.
India, being the world’s largest silver consumer, witnessed a sharp rise in silver’s premium over international prices due to strong domestic demand and limited supplies. This created opportunities for investors seeking portfolio diversification.
To protect investors amid short-term supply constraints, Kotak Mahindra Asset Management Company temporarily halted fresh lump-sum investments into its Silver ETF Fund of Fund, demonstrating a proactive approach to safeguarding investor interests.
A Testament to Investor Maturity
The overall data paints a positive picture of India’s evolving financial landscape. The consistent SIP inflows and record ETF participation highlight the growing maturity of Indian investors who are balancing risk and reward with strategic asset allocation.
Financial experts believe that these patterns reflect India’s maturing investment culture, where investors are increasingly prioritizing long-term stability over short-term speculation.
The diversification into multiple asset classes — from equities to precious metals — signifies confidence in India’s economic trajectory and its resilience amid global headwinds.
As India continues to maintain strong GDP growth, attract foreign investments, and encourage domestic participation through digital financial platforms, the country’s mutual fund industry stands as a key pillar in wealth creation and financial empowerment for millions of investors.
