Foreign investors have turned significantly more defensive on Indian equities, increasing their bearish bets on the index during the September series. FII index shorts rose 41.9% to 2.95 lakh contracts from 2.08 lakh in August, the highest level in the tracked series. Index longs, meanwhile, increased by a much smaller 16.9% to 27,879 contracts.
As a result, FIIs' net index short position widened to 2.67 lakh contracts from 1.84 lakh at the start of the September series. The FII Index Futures Long ratio stood at 0.09 relative to the previous expiry. FIIs added 4,022 index long positions during the series, compared with 87,102 short positions. The positioning indicates that foreign investors have been reluctant to rebuild meaningful long exposure to the index amid continued market volatility, domestic brokerage Axis Direct said.
