Even SEBI is cautious of the market rally.
Ajay Tyagi, Chairman, SEBI has asked fund managers to be careful in deploying people’s money. He was speaking at the first AMFI Mutual Fund Summit held recently in Mumbai.
Signalling to the market rally, the SEBI Chairman said, “This is testing time for fund managers. Markets are doing very well. There is adequate liquidity in the market. However, fund managers should be careful while dealing with investment amount of investors. You should work in fiduciary capacity, i.e., acting in best interests of your investors. SEBI is concerned about individual investors.”
One way to deploy money in such a scenario is finding new avenues, he said, and added that fund managers should explore new investment avenues such as REITs and InvITs. “While fund managers should first increase their knowledge on REITs and InvITs, they should educate investors on these new avenues,” the Chairman said.
Another issue is rising instances of default. He asked fund houses not to rely completely on credit rating agencies, but instead develop expertise on their own.