The short-lived rally on the markets saw funds offload stocks to book some profits. This marked a reversal of trend when most of August saw funds buying.

There is some positive sentiment in the markets these days, which accounts for the 170-point rally witnessed between Friday last and Tuesday. Funds seemed to have taken note of this fact, and this is reflected in the sale of stocks worth Rs 527.3 million by them on 22nd August.

As is more than apparent from the chart, funds have bought in spurts during the month. Selling has been few and far between with buys far outnumbering the sells in August, so far.

Having spoken to fund managers ourselves and from reports appearing in the press, there seems to be some consensus on the fact that this is a trading market. Which means that some funds will continue to exploit trading opportunities to enhance results. The fact that fund (net asset values) NAVs are nowadays marked by analysts and investors alike, is one of the reasons that fund managers do not want to leave an opportunity to post some growth. This indicates that we are likely to see several bouts of buying and selling, as opposed to sustained buying/selling, depending on the oscillations of the indices.

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