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China chill makes chinks in bank equities, MFs

Wed, Jan 13, 2016, 05:18 PM
Retired people who may have put their monies in mutual funds are in for a shock going by the present trend. Both the bank equities and mutual funds are not only not doing well, these are also giving negative returns. Regarded as safe investment, people have to rethink on mutual funds. But then where to invest funds because the China chill is catching up with the world economy.

In the past few days, banking equities have hit 52-week lows. This trend is not confined to public sector banks, even the private sector banks are also faring badly. The equities of big banks in the private sector such as Axis and ICICI, too, are falling.

Compared to last year, banks equities have slid down by 17%. Same is the case with mutual funds maintained by banks, which have come down by 16%. These figures match with NIFTY Bank Index which has come down by 16%.

The 18 banking mutual funds together manage investors money worth Rs.7,000 crores. Though the figure is hardly 2% of the equities, it is substantial sum for assets management.

Reliance Banking Fund, ICICI Prudential Banking Financial Services Fund, Sundaram Financial Services Opportunities Fund, Birla Sun Life Banking and Financial Services Fund and UTI Banking Sector Fund together account for about 65% of the total assets at Rs.4,400 crore.

Reliance Banking Fund, the biggest in the category, with an asset size of Rs.2.057 crore, has given a negative return of 12.78% in the last 1 year. UTI Banking Sector Fund has taken deeper cuts and its one-year return stands at 17.22% on the minus side. Birla Sun Life Banking and Financial Services Fund had given a negative return of 6.48% only.
Agency: Ap7am Desk

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