Sebi's true-to-label push splits fund industry

THE SECURITIES AND Exchange Board of India's (Sebi) latest proposal to cap the overlap between thematic/sectoral schemes and other equity schemes at 50%, in a bid to promote true-to-label investing, has divided the industry.

- ANANYA GROVER Mumbai, July 27

THE SECURITIES AND Exchange Board of India's (Sebi) latest proposal to cap the overlap between thematic/sectoral schemes and other equity schemes at 50%, in a bid to promote true-to-label investing, has divided the industry. Some players believe the proposed limit is too low and should be increased.

The consultation paper said it examined the overlap among portfolios of various schemes to ensure compliance and noted that some had significant similarities.

"It was therefore felt necessary to introduce clear limits to the industry to avoid schemes with similar portfolios," it stated.