In May 2026, the enthusiasm of mutual fund investors seemed to cool down somewhat. Investments in equity mutual funds fell to a one-year low amid rising volatility in the stock market, higher crude oil prices and global uncertainties. According to the latest data of AMFI, a total investment of Rs 22,907 crore came in equity mutual funds in May, which is about 40 percent less than in April. Although investment still remains positive, this decline shows that investors are currently avoiding taking risks and are cautious about the direction of the market.
According to the Association of Mutual Funds in India (AMFI), investments worth Rs 38,440 crore came in equity funds in April, which declined to Rs 22,907 crore in May. This is the lowest level in the last one year. It is being told that due to US-Iran tension, rising crude oil prices and market fluctuations, investors have been cautious in investing new money.
Largecap, midcap and smallcap funds also declined
Investments in almost all major equity categories declined in May. Investment in largecap funds declined from Rs 2,524 crore to Rs 1,593 crore. Investment in midcap funds declined to Rs 4,385 crore from Rs 6,551 crore. Investment in smallcap funds declined from Rs 6,885 crore to Rs 4,946 crore. Although investment in smallcap funds was the highest, there was a decline here too.
Big withdrawal from debt mutual funds
Heavy withdrawals from debt mutual funds were recorded in May. During this period, investors withdrew about Rs 96,948 crore. In April, investment of Rs 2.47 lakh crore came in this category. Most of the money was withdrawn from liquid funds and money market funds. Only modest investment was seen in credit risk funds.
Attraction of hybrid funds also decreased
Investments worth Rs 10,560 crore came in hybrid funds during May, which is about 49 percent less than in April. However, investors remained interested in arbitrage funds and multi asset allocation funds.
Slowdown in gold ETF and index funds also
A big decline was also recorded in investments in gold ETFs, index funds and other ETFs. The total investment in these schemes declined to only Rs 362 crore, whereas in April this figure was Rs 20,082 crore. Withdrawals of Rs 725 crore were also recorded from gold ETFs.
What’s next for investors?
AMFI believes that due to the ongoing market volatility and global developments, investors’ attitude remains cautious at present. However, regular investments through SIP continue and the confidence of long-term investors is still intact.
SK Sharma is a content writer who writes on news, entertainment, and lifestyle topics. She has over four years of experience and is known for conveying information in simple and clear language.
