Sebi allows mutual funds to resume investing in international stocks

Capital markets regulator Sebi has permitted mutual funds to again invest in foreign stocks within the aggregate mandated limit of $7 billion for the industry

sebi
File photo: PTI
Press Trust of India New Delhi
2 min read Last Updated : Jun 21 2022 | 12:42 PM IST

Capital markets regulator Sebi has permitted mutual funds to again invest in foreign stocks within the aggregate mandated limit of USD 7 billion for the industry.

This came in the wake of a major correction in global markets that brought down the valuation of international stocks.

In January, Sebi had asked mutual fund houses to stop taking fresh subscriptions in schemes investing in overseas stocks. The directive to stop subscription was mainly on account of the mutual fund industry crossing the mandated limit of USD 7 billion for overseas investments.

The recent meltdown in global stocks reduced the cumulative value of investments made by all the mutual fund houses together.

"Mutual fund schemes may resume subscriptions and make investments in overseas funds/securities up to the headroom available without breaching the overseas investment limits as of end-of-day of February 1, 2022, at the mutual fund level," Sebi said in a communication sent to Amfi on Friday.

Also, the regulator has asked Association of Mutual Funds in India (Amfi) to ensure that the total utilisation of the overseas limit by each AMC or mutual fund remains capped at the February level.

The regulator's approval came after Amfi made a request to Sebi for reviewing investment in overseas securities by mutual funds.

Meanwhile, Edelweiss Mutual Fund announced that it will be accepting inflows in its international schemes from Tuesday.

The schemes are -- ASEAN Equity Off-shore Fund, Greater China Equity Off-shore Fund, US Technology Equity Fund of Fund, Emerging Markets Opportunities Equity Offshore Fund, Europe Dynamic Equity Offshore Fund, US Value Equity Off-shore Fund and MSCI India Domestic & World Healthcare 45 Index Fund.

Following the Sebi's direction, several fund houses, including PPFAS Mutual Fund, DSP Mutual Fund and Edelweiss Mutual Fund, had stopped accepting inflows into their certain schemes with international mandates.

The Securities and Exchange Board of India has set an overall industry level limit of USD 7 billion for mutual funds to invest in overseas securities and funds and a separate limit of USD 1 billion for investment in overseas ETFs.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Subscribe to Business Standard digital and get complimentary access to The New York Times

Quarterly Starter

₹900

3 Months

₹300/Month

SAVE 25%

Smart Essential

₹2,700

1 Year

₹225/Month

Save 46%

Super Saver

₹3,900

2 Years

₹162/Month

Subscribe

Renews automatically, cancel anytime

Here’s what’s included in our digital subscription plans

Access to Exclusive Premium Stories Online

  • Over 30 behind the paywall stories daily, handpicked by our editors for subscribers

Complimentary Access to The New York Times

  • News, Games, Cooking, Audio, Wirecutter & The Athletic

Business Standard Epaper

  • Digital replica of our daily newspaper — with options to read, save, and share

Curated Newsletters

  • Insights on markets, finance, politics, tech, and more delivered to your inbox

Market Analysis & Investment Insights

  • In-depth market analysis & insights with access to The Smart Investor

Archives

  • Repository of articles and publications dating back to 1997

Ad-free Reading

  • Uninterrupted reading experience with no advertisements

Seamless Access Across All Devices

  • Access Business Standard across devices — mobile, tablet, or PC, via web or app

More From This Section

Topics :SEBIMutual Fundsstock markets

First Published: Jun 21 2022 | 12:42 PM IST

Next Story