SEBI is likely to relax the advertising norms for mutual funds. The market regulator has asked AMFI to suggest measures to ease advertisement norms. This decision was taken at the SEBI Mutual Fund Advisory Committee (MFAC) meeting held recently in Mumbai, said two people familiar with the development.
The committee will discuss this matter in the upcoming board meeting scheduled to held on December 13, said a senior official requesting anonymity.
Another senior official from AMFI said that the trade body has already recommended SEBI to use ‘market fluctuation’ instead of ‘market risk’ in the disclaimer. “We have recommended to the committee to replace the word ‘risk’ with ‘fluctuation’ from the disclaimer. It should be ‘Mutual funds are subject to market fluctuation. However, this was not discussed in the MFAC’s meeting. So, we will put it in our recommendations which we are going to send after the upcoming board meeting.”
Another suggestion would be to do away with the voice over which reads this message. This reinforces a negative impression about mutual fund among the people, he added.
Over the years, SEBI has introduced many rules on mutual fund advertising.
Last year, SEBI had introduced Riskometer to help investors gauge the level of risk through a meter. The regulator said that Riskometer would provide investors an easy understanding of the product/scheme they are investing in and its suitability for them.
