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Below the Quote on AMFI Data by Karthick jonagadla, smallcase manager and founder and CEO of Quantace Research

“A Market in Transition, Investor sentiment in February shifted toward stability, with small- and mid-cap inflows plunging (-35%, -34%) amid sharp index corrections (-13.8%, -10.5%). Large-cap funds saw milder outflows (-6.4%), while Focused Funds surged 64% as investors favored active management. Debt funds faced Rs 6,526 crore outflows, particularly in ultra-short duration (-Rs 4,281 crore), while liquid funds gained Rs 4,976 crore, signaling a preference for liquidity. Despite volatility, SIP contributions remained strong at Rs 26,400 crore (-0.2% MoM). Arbitrage funds (Rs 3,592 crore inflows) dominated hybrid strategies as a hedge against uncertainty. With RBI’s repo at 6.25%, an expected rate cut and CPI inflation at 4.31%, debt fund appeal may revive. The 5.6%-5.9% Nifty/Sensex correction presents valuation opportunities. Investors are shifting tactically, balancing market corrections with selective high-conviction Focused Funds while awaiting clearer macro signals.”

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