Mumbai: Capital market regulator Securities and Exchange Board of India (Sebi) on Thursday made it mandatory for asset management companies to do monthly stress tests on their liquid and money market mutual funds for better risk management.

The risk parameters for the stress test will include interest rate risk, credit risk and liquidity and redemption risk. While conducting the test, the fund houses will have to evaluate the impact of these risk parameters on the scheme’s net asset value, Sebi said in a note.