SEBI is likely to relax the advertising norms for mutual funds and may come out with new guidelines on digital media advertising.
AMFI has put forth its recommendation on advertisement norms before SEBI Mutual Fund Advisory Committee (MFAC). The committee will discuss this matter in the next meeting, said H N Sinor, CEO, AMFI. However, Sinor did not divulge the details of recommendations made to the committee.
He said, “We have given our recommendations to the SEBI Mutual Fund Advisory Committee. Also, we have made a few recommendations on digital media advertising. This matter will be discussed in the next meeting which is scheduled to be held in June.”
Another senior official from AMFI said that the trade body has recommended SEBI to use ‘market fluctuation’ instead of ‘market risk’ in the disclaimer. “We have recommended the committee to replace the word ‘risk’ with ‘fluctuation’ from the disclaimer. It should be read as ‘Mutual funds are subject to market fluctuation….”
Arvind Sethi, CEO, Tata Mutual Fund earlier told Cafemutual “Mutual fund is the only product where you have to run a disclaimer. This connotes a negative image about mutual funds. Also, we have to put so much data about past performance of schemes. We need some clarity and uniformity pertaining to the rules on performance advertisements,”
Over the years, SEBI has introduced many rules on mutual fund advertising.
Recently, 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 to them.
