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SEBI issues rule to bring uniformity in Mutual Funds Schemes, rebalanced portfolios to be submitted within 1 month

SEBI updates

SEBI issues new rules to bring uniformity in the characteristics of similar type of schemes launched by different Mutual Funds. SEBI categories and describes characteristics and uniform descriptions of the following schemes :

a. Equity Schemes
b. Debt Schemes
c. Hybrid Schemes
d. Solution Oriented Schemes
e. Other Schemes

In order to enhance the disclosure, the existing type of scheme would be replaced otherwise the purpose of the alignment of the existing schemes would not bring in the change in fundamental attribute.

SEBI further directs to have specified lock in period for the Solutions Oriented Schemes, however, the lock in period would not be applicable to any existing investment by an investor, registered SIPs and incoming STPs in the existing solution oriented schemes.

SEBI instructs Mutual Funds to rebalance their portfolios in line with the updated list, within 1 month.

SEBI defines large cap, mid cap and small cap to ensure uniformity in respect of the investment universe for equity schemes. In addition, directs Mutual Fund to adopt the list of stocks prepared by AMFI and adhere to the list prepared by AMFI.
SEBI also outlines that procedure for the categorization and rationalization of schemes in order to bring in uniformity in different types of Mutual Funds Schemes.

Reach us at nikita@lawyersconnect.info for the original copy of SEBI circular.

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