In fact, the flow is now reverse. In November so far, the FIIs have pressed sales to the tune of Rs 967 crore (Rs 9.67 billion). That is quite in contrast to the massive dose of Rs 36,600 crore (Rs 366 billion) given in the months of September and October. This amount exceeds the total net inflows during the whole of CY 2006.

A peep into the last four Novembers of this rally shows that FIIs have been net buyers in November. FIIs were net buyers in the first week as well for all the years under study. Even in the year 2005, when FIIs were net sellers in October, they reversed their trend in November to become net buyers.

Why have the FIIs turned sellers? One way to explain this phenomenon is plain and simple profit taking. Another is that curbs on the PN issuance may have something to do with this. If that was the case, then the ratio of net outflows to gross sales should have been higher than the ratio of net inflows to gross inflows. In fact, the reverse is the case.

However, the ratio of inflows to gross inflows may have been affected by the primary market infusions by the FII in the many IPOs and FPOs that hit the market during this period.

It may be too premature to conclude that the recent  curbs on PNs have negatively impacted the inflows. But the effect is clearer in the primary markets. Though the appetite by the genuine FIIs remains strong, the share of FII subscriptions has fallen.

In the case of highly popular Power Grid IPO, which came before the guidelines were amended, the FIIs contributed 71.3 per cent of the QIB category, 65 per cent of the QIB plus HNI categories and 62 per cent of the total subscription received.

In the subsequent large issues that came after the new guidelines took effect, the FII inflows as a  percentage of QIB, and other categories has reduced. Consider this, the FII subscription as a percentage of QIB subscription was 61 per cent and 70 per cent in Religare and Mundra respectively as against 71.3 per cent in Power Grid.

Similarly, if you put together the QIB and HNI categories, the ratio of FII subscriptions in Religare and Mundra were 51 per cent and 60 per cent as compared to Power Grid's 65 per cent.

The FII subscriptions which were 62 per cent of the total subscriptions in Power Grid, were much lower in the case of Religare and Mundra.

It is difficult to see the markets doing well if the FII inflows do not increase in the secondary market. One thing, however, is in favour of the markets. And that is the season.

Historically, November through February is a good period for the markets in which they tend to do well. This theory holds true not only for India but most other world markets as well, including the US.

Since 1990, the 17 Novembers that we have seen, the Sensex has given an average return of 1.93 per cent. If you were to normalise the returns by deleting the best and the worst returns, it still gives you a 1.52 per cent return on an absolute basis. In 10 out of the 17 Novembers, the returns are positive.

But what is heartening is that the of the eight Novembers that we have seen since 1999, all have tendered positive returns. The statisticians among us, however, may say that with such a long string of gains, the odds of a bad year have only increased.

As we usher in the new Samvat, may god give you the conviction to buy the stocks in which you believe, the courage to sell stocks that are overpriced and the wisdom to know the difference.