Thinking about which stocks to buy as the market has now corrected a little? Maybe the big shots in mutual funds (MF) can give a few hints. As it turns out, the big kahunas of the street have been eyeing the small fry lately. Despite all the noise and chatter about market froth, our MF managers couldn’t resist the allure of small-cap stocks.
So, what’s the scoop?
Well, it seems like our money managers have been busy bees, with the cash levels of small-cap schemes dropping by a hefty 49 basis points in March. But fear not, it’s not all about handling redemptions. There has been some serious buying action going on too. In fact, as per an analysis done by The Economic Times, MF data reveals that a whopping 32 small-cap stocks have seen fresh buying by at least 10 schemes last month. Talk about confidence! And guess what? Some of these small wonders have been delivering stellar returns.
Take Schneider Electric Infrastructure, for instance. The number of MF schemes investing in it has shot up from 11 to 19 in just one month, and the stock has nearly doubled in the calendar year so far.
But wait, there’s more. Nuvama Wealth Management, for example, had just one MF scheme as an investor in February, but by the end of March, it had skyrocketed to 15. And the stock is up a cool 44% year-to-date.
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And it’s not just these shining stars; there’s been significant buying activity in other small-cap stocks like NLC India, Aavas Finance, and Aster DM Health. On the flip side, some stocks like Amara Raja Energy and Bata India have seen the highest selling.
So, what’s the bottom line for investors? Well, while the broader markets might be seeing some ups and downs, it’s clear that there’s still plenty of action in the small-cap space. And with mutual funds betting big on these little gems, maybe it’s time for investors to take a closer look too.
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Disclaimer: The above content is for informational purposes only. Please consult a SEBI-registered investment advisor before investing in market-linked instruments.