Sebi Proposes to Conduct Review of MF Schemes' Categorisation

TO ADDRESS OVERLAP IN PORTFOLIOS

- OUR CORRESPONDENT

NEW DELHI: Markets regulator Sebi on Friday proposed to review the categorisation of mutual fund schemes in a bid to improve clarity and address the issue of overlap in portfolios of schemes.

The proposal came after Sebi noted a significant overlap of portfolios in some schemes and felt the necessity to introduce clear limits to the industry to avoid schemes with similar portfolios.

In its consultation paper, Sebi suggested that mutual funds should be permitted to offer both Value and Contra funds, subject to the condition that no more than 50 per cent of the schemes' portfolios would overlap at any point in time.