The Indian equity market rose about 5 percent in November but what was more heartening to see was inflows into mutual funds. Investors pumped Rs 1.4 lakh crore into various mutual fund schemes in the month.
With the latest inflow, the total infusion in mutual fund (MF) schemes reached about Rs 2.23 lakh crore year-to-date, latest data with the Association of Mutual Funds in India (Amfi) showed.
MF industry assets grew to Rs 23.4 lakh crore, on the back of improved inflows into liquid funds and steady equity markets. Equity-oriented funds constitute 42 percent, debt funds constitute 29 percent and liquid funds constitute 25 percent of the total assets.
Debt and liquid funds predominantly have institutional investors while equity oriented funds predominantly have individual investors.
Liquid funds attracted Rs 1.36 lakh crore, while Rs 8,400 crore was invested in equity as well as equity-linked saving schemes and Rs 215 crore in balanced funds.
Stocks which funds managers bought and sold in November:
Among large caps, Piramal Enterprises, Indiabulls Housing Finance, BHEL, Siemens and Godrej Consumer Products witnessed highest buying during November 2018, according to a report by ICICI Securities.
During the same period, AMCs sold shares of Bosch, Lupin, Vodafone Idea, Bharti Infratel and Dr Reddy’s Labs, it said.
In midcaps space, stocks like Motilal Oswal Financial Services, Alkem Labs, Ajanta Pharma, Info Edge and Adani Power witnessed highest buying during November 2018, highlighted the ICICI Securities report.
Midcap stocks, which saw selling by AMCs were Tata Communications, HEG, Page Industries, NBCC and Arvind, it said.
In small caps, stocks like Odisha Cement, Mahindra Logistics, FDC, Automotive Axles and Bajaj Electricalswitnessed highest buying during November 2018.
Small cap stocks, which saw selling by AMCs were Granules India, Merck, SREI Infra, Garware Technical Fibres and Lakshmi Machine Works.
Indian market which rallied over 5 percent in November witnessed selling pressure in the first and second week of December largely weighed down by global cues, resignation of RBI governor Urijit Patel, and state election outcome.
However, as 2019 approaches, most experts feel investors should focus on making a portfolio which is balanced and has minimum risk.
“Investors should continue to invest in systematically in equities/MF via SIP. Have a balanced mix of largecap, midcap and small cap exposure. Adequately diversify your portfolio across asset classes,” Prasanna Pathak, Fund Manager- Equity at Taurus Asset Management told Moneycontrol.
According to Pathak, for an average-risk taking investor, considering he/she has provided for contingencies and looking at medium to long-term goals, following should be the indicative allocation:
Equity: 40-50 percent (Diversified Equity Mutual Funds, Direct equity, Balanced funds)
Fixed Income: 20-30 percent (Diversified Fixed-Income MF, FD, Arbitrage Funds)
Gold: 5-15 percent ( ETF/direct)
Cash: 5-15 percent (Cash in savings bank, Liquid Mutual Funds)
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