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Mutual funds allocated record Rs 85,376 crore to bank stocks in October

New Delhi: Bullish on banking stocks, Mutual Fund managers have raised their allocation to the sector to all time-high of over Rs 85,376 crore in October.

In comparison, equity fund managers’ deployment in banking stocks stood at Rs 62,719 crore in October 2014.

Industry experts said that fund managers raised their allocation to banking stocks, especially private banks which have consistently beaten their public sector peers in performance and have lower non-performing assets (NPAs).

Also read: Mutual Funds see Rs 1.35 lakh crore inflow in October

Banking stocks have high weightage in the BSE index, Sensex.

As per the data available with the Securities and Exchange Board of India (Sebi), overall deployment of equity funds in bank stocks stood at Rs 85,376 crore in October compared with Rs 84,360 crore in the previous month.

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The previous high was in July, when allocation of funds in the banking shares was at Rs 85,329 crore.

Besides, mutual fund’s overall exposure to banking stocks was at 20.67% against 20.87% in the preceding month.

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The bankex index inched up 0.47% in the period under review, while BSE’s benchmark Sensex witnessed a growth of 1.92%.

Besides, IT was the second-most preferred sector with fund mangers after banks with an exposure of Rs 41,817 crore, followed by pharma (Rs 34,443 crore), auto (Rs 29,985 crore) and finance (Rs 23,944 crore).

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Mutual funds are investment vehicles made up of a pool of funds collected from a large number of investors and channeled into stocks, bonds and money market instruments.