Monday, April 1, 2013

Fund Flow of first quarter 2013

The current market (till end March2013) rebound is attributed to foreign buying and possibly window dressing activities by funds. As the first quarter of 2013 is drawing to an end, foreign funds are actively buying into the market. Foreign funds want to make up for the subdued market performance the last two months (Jan – Feb 2013) and probably want to end the first quarter 2013 to a positive note.

The current market (till end March 2013) rally could also be local institutional funds doing their window dressing activities. This is also supported by foreign funds buying on selected stocks. Hence this is a fight between foreign funds and local funds at the moment.

Local institutions’ participation rate has been rising in the last few days prior to 29 March 2013. On March 18 2013, local institutions’ participation rate was at 40.37% while foreign funds had 48.3% participation on Bursa. On March 27 2013, participation rate of local institutions was up to 53.3% while foreign funds were at 32.8%.

However retailers increased their participation rate. On March 27 2013, their rate was 13.8% compared to 11.33% on March 18 2013.

The GE remains one of the biggest risk factors for investors to trade and invest in Bursa Malaysia which could limit the uptrend of the KLCI once the date of the dissolution of Parliament is announced.

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Please note that all data given are merely blogger's opinion. It is strongly recommended that you do your own analysis and research before investing.