Some large mutual fund schemes have totally reworked who they are. We have identified 10 such schemes, with Rs76,306 crore of investor money in them, across five fund houses
It’s hard to miss all those emails hitting the inbox from fund houses announcing change in the names and mandates of several of their schemes. In October 2017, capital markets regulator Securities and Exchange Board of India (Sebi) instructed fund houses to re-categorise all their schemes into 36 categories that it laid out. This was done to reduce the clutter in the market and better investor understanding of the products in this Rs23 trillion industry.
By now most fund houses have announced their plans to re-categorise their schemes. While most mergers and change in mandates have been on expected lines, there are some outliers. These are funds where the new name or investment mandate may have nothing to do with the original one. There are some very large schemes that have totally reworked who they are. We have identified 10 such schemes, with Rs76,306 crore of investor money in them, across five fund houses. What is the rationale behind the change, why did the fund house decide on this course of action and what should you do?