Mutual funds (MFs) will stop accepting fresh investments in more than 100 schemes with SIP (systematic investment plan) option, as Indian stock market regulator SEBI (Securities and Exchange Board of India) has asked fund houses to move to one plan, one scheme structure.
Multiple Plans..!
As per SEBI’s guidelines, the single plan structure would apply to all new schemes with effect from October 1, 2012. while existing schemes with multiple plans (based on investment amount) can accept fresh subscriptions only under one plan. Other plans will continue till the existing investors remain invested in the plan.
SIPs provide the MF investors option to put in as low as Rs. 100 per month & have become quite popular in recent years.
Simplify MF Investments..!
While the MF houses would continue to offer SIP options in their schemes, they can not launch multiple investment plans for one single scheme. The move is part of reform measures taken by SEBI, coming into effect October 1, 2012, to simplify the mutual fund investments and re-energise the sector.
As a result, the NSE (National Stock Exchange) said in a circular that a total of about 125 schemes would be discontinued for subscription SIP registration (fresh as well as existing SIP) based on the intimation received from Asset Management Companies (AMCs), with regards to SEBI guidelines on singleplan structure for MFschemes.
Separately, BSE listed out about 85 mutual fund schemes where subscription SIP registration (for existing SIP) is being discontinued from October 1, 2012.
These schemes are available for trading on mutual fund platform of the NSE and BSE bourses.
The BSE also listed out the schemes where minimum purchase amount and additional purchase amount have been lowered.
The decision was taken by SEBI to do away with the present practice of cluttering one scheme with numerous plans.Among other reforms measures coming into effect on October 1, 2012,, the MF houses will have to make more disclosures in the interest of investors.
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