Listen to this article
SEBI has clarified that the minimum investment limit of Rs.10 lakh on Specified Investment Funds (SIFs) will not be applicable to designated employees of AMCs.
Designated AMC employees are those with a gross income of over Rs.25 lakh. According to SEBI norms, these employees must invest at least 10% of their gross annual income—excluding income taxes and statutory contributions such as NPS and PF—into the mutual fund schemes of their company.
Currently, the minimum investment limit of Rs.10 lakh is set at the AMC level. For instance, if an AMC has seven schemes across SIF categories, investors may choose to invest Rs.1.43 lakh in each scheme. However, if an investor chooses to invest in only one SIF, he must invest the entire Rs.10 lakh in that scheme.
Please note that the minimum investment limit is calculated at the AMC level. If an investor wants to invest in two SIFs from different fund houses, the applicable limit for each fund house will be Rs.10 lakh.
In another move, SEBI said that the maturity of underlying securities in an interval structure will not be applicable to interval investment strategies under SIFs.
Interval funds are positioned between open-ended and closed-ended funds. While the fund remains closed for most of the time, it opens for fresh subscriptions and redemptions during specific periods. SIFs are allowed to be launched with an interval structure as well.
Since interval funds can open for subscription and redemption multiple times, SEBI’s latest decision ensures that fund managers are not required to buy securities based on the specific opening and closing windows of the SIF.
