Inflows into equity mutual funds declined for the fourth straight month in August. Total equity inflow fell 11.4 percent month-on-month to Rs 8,375 crore in August, according to data released by the Association of Mutual Funds in India.

A Balasubramanian, CEO of Aditya Birla Sun Life AMC, spoke to CNBC-TV18 about the equity inflows and outlook.

“We go through the cycle every now and then. Since April, the trend has been coming down in terms of net inflows. August also has seen some inflows into some of the mutual fund schemes in the form of NFO collections. They are almost close to about Rs 3,500 crore of NFO collection came. At the same time, SIP subscriptions continues to be on the rise. It is a function of the market volatility,” said Balasubramanian.

“Positive trend will continue. The effort that is being put by the asset management industry in increasing the awareness among people for investing in mutual fund has to be for long-term that will keep widening. New people are now beginning to accept mutual fund as one way of investing in creating wealth,” he added.

“The largecap funds with respect to the index, there is this gap in terms of performance. The whole market is driven by four-five stocks in terms of performance, rest of the markets have not done well, that is beginning to reflect on the performance of the index. Therefore we are in that transition phase where adjustment seems to be happened,” said Balasubramanian.