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Budget 2021

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Multi-cap funds will now have to invest 25% each in large, mid and smallcap stocks

As per the new guidelines, multi-cap funds will now have to invest a minimum 25 percent each in large, mid and smallcap stocks

September 15, 2020 / 08:11 PM IST

Markets regulator Securities and Exchange Board of India (SEBI) on September 11 announced changes to the constitution of multi-cap funds.

These funds are now required to invest a minimum 75 percent of their total assets in equity and equity related instruments  from 65 percent earlier. As per the new guidelines, multi-cap funds will now have to invest a minimum 25 percent each in large, mid and smallcap stocks.

"In order to diversify the underlying investments of multi-cap funds across large, mid and small cap companies and be true to label, it has been decided to partially modify the scheme characteristics of multi-cap funds," the regulator said in a circular.

At present, there is no restrictions on the exposure such funds need to make in large, mid and smallcap stocks. As of August-end, multi-cap funds managed around Rs 1.46 lakh crore.

All mutual funds (MFs) are required to comply with the latest provisions by the first week of February 2021.
Moneycontrol News
first published: Sep 11, 2020 06:48 pm
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