Mutual Fund Stock Strategy in August 2020: In the hope of a recovery in the economy, mutual fund houses once again have increased confidence in private banks.
Mutual Fund Stock Strategy
In the hope of recovery in the economy, mutual fund houses once again have increased confidence in private banks. In July, the weightage of private bank shares reached a 22-month low in total allocation, which increased by 110 basis points to 17.3 per cent on a monthly basis in August. Apart from private bank shares, the focus of mutual funds has increased on the entire financial sector. Of the 10 stocks in which mutual funds made the most purchases on August, 7 were from the financial sector. However, mutual funds’ trust in oil and gas has decreased. In this regard, brokerage house Motilal Oswal has given a report. Know where the mutual fund bought and sold in August.
Mutual funds no longer have seen defensive
The stock market has recovered significantly from the March low. After June, the market has shown a boom in July. Currently, mutual funds have also changed their strategy in this changed mood of the market.
Mutual funds were previously looked defensive, now their strategy looks different. He has increased investment in private banks, government banks, capital goods, automobiles, real estate, NBFCs, metals and retail sectors. Most of them are the key players in the economic growth of the sector. While banks and financial sectors have a major contribution in economic recovery, auto and capital goods are signs of improving demand.
Reduced focus on these sectors
It is clear from the data of August that the focus of mutual funds on oil and gas, consumer, technology, telecom, cement and healthcare sectors has decreased somewhat.
Top 10 Stocks (Value Change)
ICICI Bank, Axis Bank, HDFC Bank, SBI, HDFC, NTPC, Device Lab, Bandhan Bank, Emami, Bajaj Finance
Bottom 10 stocks (change in value)
Bharti Airtel, HUL, Infosys, Aurobindo Pharma, Altratech Cement, RIL, HDFC Life Science, SBI Life Science, HCL Tech, IOCL
Buyer in 38% shares of Nifty 50
In the month of June, the focus of mutual funds has decreased somewhat on frontline stocks. According to the report, in 38% of the shares of Nifty 50, mutual funds have been buyers in July. Whereas a month ago, they were buyers in 40 per cent and before that about 50 per cent shares.
AUM rose 1.4 per cent to 27.5 lakh crore
Asset under the management of the mutual fund industry has increased by 1.4 per cent to Rs 27.5 lakh crore in August. Equity mutual funds have seen a withdrawal of Rs 3800 crore in August. This happened last month also. This withdrawal has been observed due to profit-booking by mutual fund investors. Earlier, in June, Rs 240.55 crore was invested in equity mutual funds. According to the Association of Mutual Funds in India (AMFI), the investment through SIP has come down to Rs 7790 crore in August.
(Report: Brokerage House Motilal Oswal)
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