look news india
Mumbai: In a bid to bridge the gap between mutual funds and portfolio management services (PMS), capital markets regulator Securities and Exchange Board of India (SEBI) has proposed to introduce a new asset class or product category with a minimum investment of Rs 10 lakh.
The minimum investment under this new asset class is Rs 10 lakh per investor. The new asset class is expected to provide regulated investment products to investors with higher risk appetite and larger ticket sizes, the capital market regulator said, with the aim to control the proliferation of unregistered and unauthorised investment products.
In the consultation paper, Sebi said the proposed new asset class intends to bridge the gap between mutual funds and PMS by offering regulated products with greater flexibility, higher risk appetite and larger ticket sizes to meet the needs of emerging categories of investors.
The regulator recommended a distinct nomenclature for the new asset class, which will differentiate it from traditional mutual funds and other investment products already available in the securities market such as PMS, AIFs (alternative investment funds), REITs (real estate investment trusts) and InvITs (infrastructure investment trusts).
SEBI has said that the minimum investment amount in the new asset class in an AMC (asset management company) or mutual fund will be Rs 10 lakh per investor. Investors can have a choice of systematic plans like Systematic Investment Plan (SIP), Systematic Withdrawal Plan (SWP) and Systematic Transfer Plan (STP) for investment strategy under the new asset class.