2 days ago
Sebi Launches Rs 25-Lakh Mutual Fund Portfolio Route
Sebi has created a new way for people to get professional investment help.
It is called PRIM and focuses on mutual funds and similar investments.
People will need to invest at least Rs 25 lakh.
This is lower than the Rs 50 lakh needed for regular portfolio management services.
Managers can invest in mutual funds, index funds, ETFs and special investment funds.
Sebi also set rules to reduce conflicts of interest and protect clients.
Portfolio managers can charge a fixed fee of up to 1% and may also charge based on performance.
The rules also let regular portfolio managers invest in more types of Indian and overseas assets.
Sebi introduced PRIM, allowing portfolio managers to invest in direct mutual fund plans, index funds, ETFs and SIFs.
The minimum investment is Rs 25 lakh, half the conventional PMS threshold of Rs 50 lakh.
Portfolio managers offering PRIM need Rs 2 crore in net worth, and exit loads are waived.
PRIM fees can include a fixed management fee of up to 1% of assets and performance-linked charges.
Sebi also expanded conventional PMS access to selected unlisted debt, derivatives, overseas assets and IPOs.
- Who
- The Securities and Exchange Board of India (Sebi), portfolio managers, mutual fund distributors and investors.
- What
- Sebi introduced the Portfolio Managers Route for Investing in Mutual Fund Units (PRIM) and widened the investment options available under conventional PMS.
- Where
- India, under Sebi’s regulatory framework.
- When
- On Thursday; the articles do not provide a calendar date.
- Why
- To create a mutual fund-focused route with a lower investment threshold and to simplify portfolio-management rules while expanding permitted investments.
Key facts
- New route
- Portfolio Managers Route for Investing in Mutual Fund Units (PRIM)
- Minimum investment
- Rs 25 lakh
- Conventional PMS threshold
- Rs 50 lakh
- PRIM net-worth requirement
- Rs 2 crore for portfolio managers
- Fixed management fee
- Up to 1% of client assets
- Affiliated AMC investment ceiling
- 25% of investments in schemes managed by an affiliated asset management company
- Overseas remittance limit
- The Liberalised Remittance Scheme permits resident Indians to remit up to $250,000 abroad in a financial year
Sources
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