FPIs bet on domestic high-momentum, high-beta plays; 5 stocks they are bullish on
The September quarter was quite good for domestic equities as far as foreign inflows were concerned, even though most emerging markets (EMs) were nervous about the big events, including the US presidential election and a looming Fed rate hike.
Now data for the quarter showed foreign portfolio investors bought stocks that showed high price momentum, high beta, low-to-medium dividend yield and medium financial leverage.They also bought low-leverage and medium-to-high dividend yield stocks in a limited measure, a report from ICICI Securities showed.
DIIs, on the other hand, sold high-momentum and high-beta stocks and selectively bought low-leverage and medium-to-high dividend yield stocks, the study on BSE100 stocks revealed.
Momentum stocks are stocks which are most persistence in their relative performance, measured by their-risk adjusted price momentum.
Overall, FPIs sold stocks in the export-oriented pharma and IT sectors as well as telecom and consumer discretionary segments.
They were seen buying into domestic economy-focused themes such as financials, auto, metals, energy and materials.