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What will be the benefit?
Mutual fund expert Vijay Mantri says that currently there are three main investment options. These include Mutual Fund, PMS (minimum investment in this is up to Rs 50 lakh) and the third is Alternative Investment (minimum investment is Rs 1 crore). The new asset class will bridge the gap between mutual funds and PMS. Will provide investors an option to invest between Rs 10 lakh to Rs 50 lakh. In this, the strategy of the fund manager will be different from the investment strategy of traditional mutual funds. What is the purpose?
The new product also aims to prevent unregistered and unauthorized investment schemes, which often promise unrealistically high returns and take advantage of investors’ expectations for better yields, thereby creating potential financial risks. How different from common MF?
Regarding the new asset class, it is also being said that the investment strategy in it will be such, which is not available in common mutual funds. Can this be risky for retail investors? Rahul Jain, head of Nuvama Wealth, says the new asset class will benefit investors by eliminating the need to use unregulated and unauthorized products. This would also be a good option for high net worth individuals, as it would provide an opportunity to take advantage of strategies like long-short and inverse exchange-traded funds. Isn’t it too risky?
Financial planner Karthik Jhaveri says that at first glance these seem a bit risky, but even if so, it may be necessary to give them a detailed description by the regulator before bringing them. With the current structure, it doesn’t seem too risky. However, there are risks related to the market, they are there for everyone.
New Delhi: Market regulator SEBI has cleared the way for new asset classes/investment products in its board meeting. In the details released by SEBI, it has been said that this product will bridge the gap between Mutual Fund (MF) and Portfolio Management Services (PMS).
Mutual fund expert Vijay Mantri says that currently there are three main investment options. These include Mutual Fund, PMS (minimum investment in this is up to Rs 50 lakh) and the third is Alternative Investment (minimum investment is Rs 1 crore). The new asset class will bridge the gap between mutual funds and PMS. Will provide investors an option to invest between Rs 10 lakh to Rs 50 lakh. In this, the strategy of the fund manager will be different from the investment strategy of traditional mutual funds.
The new product also aims to prevent unregistered and unauthorized investment schemes, which often promise unrealistically high returns and take advantage of investors’ expectations for better yields, thereby creating potential financial risks.
Regarding the new asset class, it is also being said that the investment strategy in it will be such, which is not available in common mutual funds. Can this be risky for retail investors? Rahul Jain, head of Nuvama Wealth, says the new asset class will benefit investors by eliminating the need to use unregulated and unauthorized products. This would also be a good option for high net worth individuals, as it would provide an opportunity to take advantage of strategies like long-short and inverse exchange-traded funds.
Financial planner Karthik Jhaveri says that at first glance these seem a bit risky, but even if so, it may be necessary to give them a detailed description by the regulator before bringing them. With the current structure, it doesn’t seem too risky. However, there are risks related to the market, they are there for everyone.