 |
Le 'Mutual Fund Lite' be like*😂💹:- PMS ka copy-paste nahi, bas ek light version hoon me. Passive mode ON karke, aur portfolio ko chill pe rakh ke.. aap sirf returns ka maza lo 😎! |
What is Mutual Fund Lite?
"Mutual Fund
Lite" offers professional portfolio management services like a mutual
fund, but with lower entry costs compared to Portfolio Management Services
(PMS). Unlike PMS, which requires ₹50 lakh, Mutual Fund Lite allows investments starting at ₹10 lakh and focuses on
passive investment strategies, meaning the investor doesn't actively manage the
portfolio. It offers some customization but isn’t as personalized or hands-on
as PMS.
Key
Features of Mutual Fund Lite:
1. Relaxed Sponsor Eligibility: Less
strict rules regarding net worth, track record, and profitability for sponsors.
2. Simplified Approval Process: A quicker
and easier approval process for launching passive mutual fund schemes.
3. Reduced
Compliance Requirements: Fund houses will have fewer disclosure and
regulatory burdens.
Objectives:
· Ease of Entry: Simplified rules to allow
more fund houses to enter the passive mutual fund space.
· Increased Penetration: By
lowering barriers, more mutual funds can be launched, giving more investment
options to people.
· Enhanced Liquidity: More
players in the market mean greater liquidity and competition.
· Diversification: More
passive fund options will provide better diversification opportunities for
investors.
· Innovation: A lighter framework will
promote the creation of innovative passive fund products.
What’s
the Difference Between Passive and Active Funds?
· Passive Funds: These replicate an index
like the Nifty 50 or Sensex and don’t require active management by the fund
manager.
· Active Funds: These are actively
managed by fund managers who make decisions about which securities to invest
in.
Why
Mutual Fund Lite?
Under the current
regulatory framework, the rules for mutual funds are the same for both active
and passive schemes. However, since passive schemes are simpler (as they follow
an index), Sebi has approved a "light-touch" regulation specifically
for them under MF Lite.
Key
Provisions of MF Lite:
· Separate Entity Option:
Existing fund houses can move their passive schemes into a separate entity if
they wish to.
· Relaxed Requirements: Funds
under the Mutual Fund Lite framework will enjoy eased disclosure and compliance
rules.
The
Growth of Mutual Funds in India:
The mutual fund industry in
India has seen rapid growth:
· Assets under management (AUM) have increased more than seven-fold
in the last decade, from ₹8.3 lakh
crore in 2013 to ₹61.2 lakh
crore in 2024.
· Passive Funds AUM have reached ₹10.2 lakh crore with a 17% market share, while active funds hold ₹50.9 lakh crore.
Conclusion:
SEBI's
Mutual Fund Lite is an excellent option for retail investors, allowing them to
access professionally managed portfolios with a minimum investment of just ₹10 lakh. This passive
investment strategy enables investors to benefit from expert management without
the high entry barriers of traditional PMS. It simplifies the investment
process, making it easier for retail investors to grow their wealth while
enjoying the peace of mind that comes from having experienced fund managers handle
their investments. Overall, Mutual Fund Lite makes investing more accessible,
efficient, and hassle-free.
Comments
Post a Comment