How did Banking sector perform during the month of Bhadra?

NEPSE index increased from 1391.46 to 1541.40 during the month of Bhadra, which is 10.76% growth. That's a good growth right!  Banking occupies huge chunk of daily transactions of total turnover on any day. Okay! so, then how did banking sector do during the period? 

Banking index measures the performance of all commercial banks based upon the market capitalisation. During the period, the index was at 1182.37 on 32 Shrawan which then subsequently to 1221.31. The change was 3.29%. Really! But, isn't it less than NEPSE's growth? Of course, it is. So, we can conclude that Banking sector didn't do well in comparison to overall market during the period. Hydropower did awesome during the period. If you want to look at the figures CLICK HERE.

However, I still want to know the underdogs within banking sector. Well, if we look at the table below, we can see that:

• Bank of Kathmandu's share price increased the most by 9.29%. On the starting date, the share price of this company was Rs. 226 which increased to Rs. 247.
• It was followed by Nepal Credit & Commerce Bank (NCCB) whose share price increased from Rs. 192 to Rs. 209. That's a growth of 8.85%.
• Century Commercial Bank (CCBL) and Citizens Bank (CZBIL) share price has decreased by 0.58% and 0.52% respectively.
• 12 out of 26, had sensitivity more than 1. which indicated these are more volatile than overall banking index.

Overall, we can say that BOKL increased the most in percentage terms whereas CCBL and CZBIL decreased while the market was increasing. CCBL and CZBIL is negatively correlated to overall market. These negative correlated stocks could be useful for hedging during bearish market. 

Did you think it was over?! Hell no! The big surprise is that even though BOKL increased the most in percentage terms if you look at it from points gained it only increase by 21 whereas Nabil Bank (NABIL) increased by 31 points. Oh Rupesh, you are such a kill joy! I thought I knew it all! Why did this happen? Have a look at the share price, NABIL's starting price was Rs. 822 which was Rs. 853 at the end of the month that is....ummm......53-22.....3-2=1....5-2=3....Okay, got it! Rs. 31 right! So stupid of me the figure is just below! Anyways, Rs. (31/822) is only 3.77% whereas in case of BOKL Rs. (21/226) is 9.29%. Did you get it? Even if you didn't. Don't worry, I'm right here! The share price of NABIL is in 800 range whereas BOKL is in 200 range. So, whenever you determine change and the amount is small, the percentage will be big coz you're denominator is small whereas it case of NABIL the denominator is huge so the percentage is small!

Thus, it would be wiser to check the share price or use the change price to sort out your selection of stocks. 

I hope you enjoyed reading this! Good luck with your investing journey!!

Until next time, BY-BYE!!!

References:

Nepal Stock Exchange