Stopped fresh inflows in the fund keeping investor’s best interest in mind
Vinit Sambre of DSP BlackRock, on how stopping fresh inflows into the Micro Cap Fund would impact the fund and its investors
When mid-cap, small-cap or micro-cap funds become too large, fund managers often find it hard to manage them, because the scheme’s liquidity gets compromised if there is a rush on redemptions. Traditionally, the Indian mutual funds industry did not have the practice of stopping inflows, possibly because continuous inflows make them larger and larger. But slowly, the industry is waking up to the need to close their doors—in the best interest of existing investors. The latest to do so is DSP BlackRock Micro Cap Fund, which shut its doors with effect from 20 February, for sale of fresh units for both lump sum investments and systematic investment plans (SIPs). We spoke to its fund manager Vinit Sambre, to find out how this would impact the fund and its investors. Edited excerpts:
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