“Complying with the Regulation and after all the necessary approvals the required changes will be effective in our flagship scheme. However, there is no change in our portfolio, investment process. We will continue to manage the money the way we have been managing. A flexicap strategy will allow the fund manager to invest wherever value and opportunities are available without restrictions,” mentioned Neil Parag Parikh, Chairman and CEO, PPFAS Mutual Fund.
The new adjustments had been necessitated after Sebi modified the funding mandate of multi cap schemes in September. As per the brand new mandate, multi cap schemes should make investments a minimum of 25% every in giant cap, mid cap, and small cap shares. Earlier, the multi cap schemes had the liberty to speculate throughout market capitalisations and sectors based mostly on the view of the fund supervisor.
Most mutual fund managers and funding consultants believed that the brand new Sebi mandate would change the danger profile of multi cap schemes and they might not be appropriate for average fairness traders anymore. They identified that 50% minimal funding requirement in mid cap and small cap shares would make them an especially dangerous class.
Fund home had been considering recategorizing their schemes into one of many current classes like worth, ESG, targeted, and so forth, when Sebi relented and launched a brand new class known as flexi cap which might be an apt class for the erstwhile multi cap funds.
Many huge fund homes have already recategorised their multi cap schemes within the final one month. With Parag Parikh Long Term Equity Fund taking step one, many different multi cap schemes are prone to announce the recategorization of their multi cap schemes within the coming days.