Sebi modifies mutual fund advertisement norms
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Mumbai: The Securities and Exchange Board of India, or Sebi, on Wednesday directed mutual funds to disclose the performance of their schemes since inception and during the preceding one-year, three-year and five-year periods while advertising.
At present, mutual funds are required to publish the scheme’s returns for as many 12-month periods as possible during the preceding three years.
Sebi said while advertising a particular MF scheme, the performance of other schemes managed by the concerned fund manager also has to be disclosed in a summarized manner, along-with the respective scheme’s benchmark.
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Also, to create awareness and attract more investments, Sebi has allowed celebrity endorsements at the MF industry level.
The money mutual funds set apart every year for investor education and awareness will be used for such celebrity endorsements at the industry level, Sebi said. At present every mutual fund is compulsorily required to set aside at least 2 basis points (bps) on daily net assets for investor education and awareness initiatives.
The amended MF norms will come into effect from 1 April, Sebi said.