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Fund flows in March 2024. Listed funds witnessed inflows of US$1.9 bn, led by ETF inflows of US$2.2 bn, which was offset by non-ETF outflows of US$312 mn. India-dedicated funds witnessed inflows of US$2.3 bn, broken down into US$1.6 bn of ETF inflows and US$738 mn of non-ETF inflows whereas GEM funds saw US$144 mn of outflows, led by US$530 mn of non-ETF outflows, which was offset by US$386 mn of ETF inflows.

• Emerging market flows. Listed emerging market fund flows were mixed for most countries. Taiwan, India and China witnessed US$6.9 bn, US$1.9 bn and US$113 mn of inflows whereas Brazil, Indonesia and Thailand saw outflows of US$547 mn, US$257 mn and US$171 mn. Total FPI and EPFR activity showed divergent trends for Indonesia and Taiwan and similar trends for India and Thailand.

• Country allocations. Allocations to China and India constitute 42% of the average Asia ex-Japan fund portfolio. Asia ex-Japan funds’ allocations to India declined to 19.4% in March from 19.8% in February, whereas allocations to India by GEM funds remained stable at 18.3% in March. Allocations by Asia ex-Japan non-ETFs to India declined to 19.8% in March from 20.1% in February; allocations to India by GEM non-ETFs remained at 16.6% in March.

Product description and methodology. KIE’s foreign fund flow tracker gives a comprehensive view of the market flow by listed funds into India and its emerging market (EM) peers. These market participants are further classified based on their investment styles—passive (ETFs) or active (non-ETFs)—in an attempt to understand the intent and sentiments governing the flow. Please note that there is a difference between EPFR-reported fund flows and FPI flows reported by NSDL. EPFR fund flow data primarily tracks mutual funds, ETFs, closed-end funds and variable annuity funds/insurance-linked funds, whereas NSDL-reported FPI flows also capture investments from hedge funds, proprietary desks and sovereign wealth funds.

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