There is an old saying that ‘success begets success’. The same logic applies to the mutual fund sector wherein a successful theme or sector keeps getting additional funds most fund managers. This happened to banking and IT stocks recently.
Almost all top asset management companies (AMCs) have invested the largest allocation of their AUMs (assets under management) in banking stocks followed by other sectors such as software, consumer durables and finance.
In the banking stocks, the allocation of AMCs' is as high as 15 percent by UTI mutual fund and 11.1 percent by HDFC MF. Similarly, most AMCs choose software as the next important sector to invest in. Axis MF has, for instance, invested 7.6 percent of its assets in it while SBI MF invested 6.7 percent.
UTI Mutual Fund: It has invested 15 percent in banks, followed by 9.2 percent in software, 6.3 percent in FMCG and 6.6 percent in finance, and 3.3 percent in pharma.
DSP Mutual Fund: It has allocated 9.9 percent in banks, 5.1 percent in software, 3.4 percent in FMCG, 5 percent in finance, 4.6 percent in pharma and 2.6 percent in auto.
Kotak AMC: It has invested 11.9 percent in banks followed by 3.3 percent in software and 2.4 percent in consumer non-durables and 2.1 percent in finance and 2 percent in pharma.
SBI Mutual Fund: It has invested 16.3 percent in banks, 6.7 percent in software, 5.3 percent in consumer non-durables, 6.2 percent in finance and 2.9 percent in pharma.
Nippon AMC: It has allocated 11.9 percent of its funds to banks, 4 percent to software, 3 percent to consumer non-durables, 4.4 percent to finance and 3.2 percent to pharma.
HDFC AMC: It has invested 11.1 percent of its funds to banks, 4.5 percent to software, 2.4 percent to consumer non durables, 4.6 percent to finance and 2 percent to pharma.
Axis AMC: It has invested 8.9 percent in banks, 7.6 percent in software, 2.6 percent in consumer non-durables, 9.7 percent in finance and 2.3 percent in pharma.
ICICI Prudential Mutual Fund: This fund house has invested 10.8 percent in banking stocks followed by 5.9 percent in software, 2.3 percent in consumer non-durables, 3.7 percent in finance and 2.9 percent in pharma.