Equity mutual funds rebound in June; Gold ETFs shine

Equity mutual funds staged a strong comeback in June 2026, pulling in net inflows of Rs 28,973 crore, a 26 per cent increase month-on-month, after MF inflows nearly halved at Rs 22,908 crore in May. The rebound in inflows highlights underlying strength in investor sentiment despite elevated global uncertainty and bouts of volatility in markets. 

“Positive sentiment, expectations around favourable domestic macroeconomic factors and consistent retail investor flows supported healthy investments in the month. Inflows into equity funds in H1CY2026 were up by more than 12 per cent as compared to H1CY2025, led by strong inflows into mid-cap and small-cap funds,” said Sanjay Agarwal, Senior Director at CareEdge Ratings, commenting in the AMFI Data for June.

Precious metal ETFs witnessed inflows during June, especially gold ETFs which pulled in over Rs 7,500 crore as compared to an outflow of Rs 2,800 crore in May. The consistent interest from investors towards gold ETFs highlights their growing acceptance as an asset allocation and portfolio diversification vehicle. Hybrid schemes witnessed inflows of Rs 12,893 crore during June as compared to Rs 10,560 crore during May continuing investors’ preference for balanced solutions.

Debt-oriented mutual funds recorded net outflows of Rs 1.09 lakh crore in June 2026. The outflows were largely driven by quarter-end liquidity requirements, prompting institutional investors and corporate treasuries to withdraw funds from ultra-short-duration, liquid, money market, and overnight schemes. More notably, short-duration and corporate bond funds also witnessed redemptions. Meanwhile, the quarter witnessed net inflows of Rs 41,888 crore compared to the outflows of Rs 1.78 lakh last quarter and inflows of Rs 2 lakh crore in the same quarter last year. The category in likely to witness inflows in July 2026 similar to that witnessed in July 2025 (Rs 1 lakh crore).

“The mutual fund industry’s assets under management marginally increased sequentially by 0.8% to Rs 82.22 lakh crore in June 2026 with open ended schemes continuing to account for over 99 per cent of the industry AUM. This increase comes despite an outflow of Rs 0.53 lakh crore which was lower than the outflows of Rs 0.64 lakh crore witnessed last month. The decline was largely due to a withdrawal of Rs 1.09 lakh crore from debt-oriented schemes,” said Agarwal.

New issuances continued to remain muted as only 7 new fund offerings were launched in June 2026, collectively mobilising Rs 460 crore marginally lower than the amount collected last month. A single Aggressive Hybrid Fund accounted for 67 per cent of this mobilisation with a balance coming from index funds, ETFs and a Large & Mid Cap Fund.