New Delhi, Nov. 12 -- With uncertainty lingering over the global economic environment, October saw the participation of investors in equity mutual funds slump. Inflows into these funds fell 19% from September to Rs.24,690 crore, the third-straight month of decline, data released by the Association of Mutual Funds in India on Tuesday showed.

The fall was broad-based, though bigger in large-cap funds, which received just Rs.972 crore, down from Rs.2,319 crore. This is somewhat surprising considering large-cap shares in India presently are relatively inexpensive compared to small- and mid-cap shares and tend to offer better protection during times of market volatility.

What seems to be weighing on investors' minds is the external uncertain...