- Jun 20, 2002
September is always a negative month in the Australian stockmarket, as October generally is in USA. Reporting season is over, markets slide on no news.Share market has been down recently. That's put a dampener.
I should check, but is it likely to be in any indexes where funds are going to have to go around buying shares to keep their portfolios aligned?
Index funds will need to look at whether they need to purchase - it will depend on their type of replication of the relevant indexes. For funds with full replication, they will be buying. For ones that partially replicate, they may not need to, depending on which stock will no longer be in the relevant index the funds track.I would have thought that as the biggest player in the health insurance market, most funds would have to own a portion to balance their portfolio, and if oversubscribed, would have to buy after the float.
Other fund managers (depending on their style) will be assessing the relative merits of holding the stock in their portfolios (whether they be value or growth manager, etc). so many different investment styles and no clear indication whether they will hold at inception. They will have their analysts pulling apart the financial data in the Prospectuses and doing risk analyses. All in a days work for these guys