Mutual funds were turning net sellers in the equity markets in a strategy aimed at piling up cash, anticipating a post-Budget portfolio churning, analysts said. |
For the February 2-12 period, mutual funds were net sellers in the equity markets at Rs 1,083.50 crore. |
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They also sold their debt market investment for most of the days. Mutual funds bought Rs 55.53 crore of shares during the same period. The fund houses were net sellers in equity markets at Rs 1,342.23 crore in January too. |
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"I think the fund houses are looking at possible portfolio options; the stocks that could rise post-Budget. The funds are studying the sectoral performances and anticipating which sectors could surge ahead after the Budget," Sameer Kamdar of Mata Securities said. |
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In contrast, foreign institutional investors (FIIs) were net buyers of equities during the same period, propelling the benchmark stock indices to record levels last week. Since February 2, the FIIs have bought equities worth Rs 2,713 crore. |
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The Sensex marked its all-time high twice last week. This week, however, it witnessed volatility, as it lost 447.92 points in the previous two trading days. |
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Figures available from the Sebi website showed that the mutual funds turned net sellers on February 2, selling equities worth Rs 77.63 crore. This weak, the trend continued, with fund houses garnering Rs 165.53 crore on February 5 by selling equities and another Rs 67.40 crore by selling their debt investments. |
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The selling in equities continued this week too, with funds selling equities worth Rs 389.38 crore on February 12. "It is not that funds have shed large amount of equities. It is part of their normal strategy. |
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For example, most of the funds have good exposure to banking stocks. If they think these stocks would not perform in the coming days, they would sell the stocks as valuations are good," a fund manager with a top equity fund said. |
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