Monday, January 7, 2013

Mutual funds remained heavy net sellers of equities in December

All’s well that ends well, so goes the adage. However, in 2012 that remained a distant dream for India’s mutual fund industry’s equity segment.

The struggling sector failed to attract retail investors even in the last month of the year when optimism rose significantly higher on equity to be an outperforming asset class in the coming years.

December witnessed the second largest net selling by equity fund managers during the year as they sold shares worth Rs 2,700 crore amid redemption pressure.

Despite being a flat month when indices gained a marginal half percentage point, sector officials say, investors’ request for redemptions from equity schemes continued unabated.

According to the chief investment officer (CIO) of a large fund house, no one would want to take a cash call when there are anticipations for a turnaround in the market. “So, when investors want to redeem, as they had been doing for the last two to three years, we have no alternative but to sell our holdings,” he admits.

Though industry body Association of Mutual Funds in India ( Amfi) would release the monthly data of fund inflows next week, industry insiders say sales remained poor and December would not be any better than the previous months.

In a year that saw the country’s benchmark stock indices give returns of over 25 per cent, the mutual fund industry remained a net seller in a rising market. Rather, in the October-December quarter, the sale of shares only intensified as the fund industry sold equities worth Rs 7,615 crore.

During the full year, equity managers sold shares worth Rs 17,955 crore.

“Unfortunately, in last year’s rally domestic investors did not participate,” adds the CIO. According to statistics available from the Securities and Exchange Board of India ( Sebi), till November 2012 the industry had lost over three million equity folios.

The national sales head of a private bank-sponsored asset management company ( AMC), says, “The equity segment remained a big problem. Purchases remained poor compared with redemptions. But, I believe as the situation improves, retail will come back.”

Net outflows from pure equity schemes stood at Rs 9,370 crore till November, which during the corresponding period in the previous year was in positive territory with net inflows of Rs 3,236 crore.

This is despite the fact that several schemes, including banking equity schemes, FMCG schemes and pharma schemes among others, outperformed the benchmark indices during the year. For instance, schemes which primarily invest in banks and FMCG companies gave returns of over 50 per cent during the year while those of pharma-related schemes rewarded investors with over 30 per cent returns.

Source: http://business-standard.com/india/news/mutual-funds-remained-heavy-net-sellersequities-in-december/497641/

No comments:

Just click away from joining most active Mutual Fund India google group

Google Groups
Subscribe to Mutual Fund india
Email:
Visit this group

Aggrasive Portfolio

  • Principal Emerging Bluechip fund (Stock picker Fund) 11%
  • Reliance Growth Fund (Stock Picker Fund) 11%
  • IDFC Premier Equity Fund (Stock picker Fund) (STP) 11%
  • HDFC Equity Fund (Mid cap Fund) 11%
  • Birla Sun Life Front Line Equity Fund (Large Cap Fund) 10%
  • HDFC TOP 200 Fund (Large Cap Fund) 8%
  • Sundram BNP Paribas Select Midcap Fund (Midcap Fund) 8%
  • Fidelity Special Situation Fund (Stock picker Fund) 8%
  • Principal MIP Fund (15% Equity oriented) 10%
  • IDFC Savings Advantage Fund (Liquid Fund) 6%
  • Kotak Flexi Fund (Liquid Fund) 6%

Moderate Portfolio

  • HDFC TOP 200 Fund (Large Cap Fund) 11%
  • Principal Large Cap Fund (Largecap Equity Fund) 10%
  • Reliance Vision Fund (Large Cap Fund) 10%
  • IDFC Imperial Equity Fund (Large Cap Fund) 10%
  • Reliance Regular Saving Fund (Stock Picker Fund) 10%
  • Birla Sun Life Front Line Equity Fund (Large Cap Fund) 9%
  • HDFC Prudence Fund (Balance Fund) 9%
  • ICICI Prudential Dynamic Plan (Dynamic Fund) 9%
  • Principal MIP Fund (15% Equity oriented) 10%
  • IDFC Savings Advantage Fund (Liquid Fund) 6%
  • Kotak Flexi Fund (Liquid Fund) 6%

Conservative Portfolio

  • ICICI Prudential Index Fund (Index Fund) 16%
  • HDFC Prudence Fund (Balance Fund) 16%
  • Reliance Regular Savings Fund - Balanced Option (Balance Fund) 16%
  • Principal Monthly Income Plan (MIP Fund) 16%
  • HDFC TOP 200 Fund (Large Cap Fund) 8%
  • Principal Large Cap Fund (Largecap Equity Fund) 8%
  • JM Arbitrage Advantage Fund (Arbitrage Fund) 16%
  • IDFC Savings Advantage Fund (Liquid Fund) 14%

Best SIP Fund For 10 Years

  • IDFC Premier Equity Fund (Stock Picker Fund)
  • Principal Emerging Bluechip Fund (Stock Picker Fund)
  • Sundram BNP Paribas Select Midcap Fund (Midcap Fund)
  • JM Emerging Leader Fund (Multicap Fund)
  • Reliance Regular Saving Scheme (Equity Stock Picker)
  • Biral Mid cap Fund (Mid cap Fund)
  • Fidility Special Situation Fund (Stock Picker)
  • DSP Gold Fund (Equity oriented Gold Sector Fund)