Mutual Fund: Now call it scheme, not fund, there will be changes in Mutual Fund; SEBI presented proposal; Know what is new..

Market regulator SEBI on Friday presented some proposals to improve mutual fund schemes. The purpose of these proposals is to clarify the schemes and reduce the problem of similarity in the portfolio. Many things have been mentioned in SEBI's proposal. SEBI has sought public opinion on the proposals presented. You can give your opinion to SEBI till August 8. Let us know what the main ones are in these.

Suggestion to start these funds
Market regulator SEBI suggested mutual funds to start both value and contra funds. But there should not be more than 50% similarity in their portfolios. This should be checked at the time of New Fund Offer (NFO) and then every six months on the basis of the month-end portfolio. If similarity is found, the Asset Management Company (AMC) will have to correct the portfolio by changing it within 30 working days.

Suggestion to invest in different categories

SEBI suggested in one of its proposals that mutual funds can invest in equity, debt (bonds, money market), gold, silver, real estate investment trusts (REITs), and infrastructure investment trusts.

Suggestion to change the names of debt schemes

SEBI also suggested changing the names of debt schemes in its proposal so that investors can understand them easily. SEBI said that the word 'term' will be used instead of 'duration'. The name of 'low duration fund' should be changed to 'ultra short to short term fund', and the name of each debt scheme should reflect its duration. Such as overnight fund (1 day) or medium term fund (3 to 4 years).

Proposal to start sectoral debt fund

SEBI suggested mutual funds start sectoral debt funds. Provided that their portfolio does not have more than 60% similarity with other sectoral debt or debt category schemes.

Now say scheme, not fund.
SEBI suggested that the word scheme should be used instead of fund in mutual funds. Like 'large cap scheme', small cap scheme and midcap scheme etc. Mutual funds will be offered in five main categories - equity-oriented scheme, debt-oriented scheme, hybrid scheme, solution-oriented schemes.

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