Forward Market Commission (FMC) has finally been merged with SEBI on Monday. The Union Finance Minister Arun Jaitley has rung the customary stock market bell to announce this amalgamation. This is the first time when two regulators have been merged in India.
Earlier, in his budget speech 2015, Jaitley had announced the merger of FMC with SEBI.
SEBI has appointed Rajeev Kumar Agarwal, Whole-Time Member, SEBI to oversee this amalgamation and ensure smooth transition.
This merger may enable fund houses to come up with commodity mutual funds. Commodity funds invest in metals like copper, aluminium, oil, gold, silver and platinum and agriculture produce. In India, mutual fund houses are not permitted to invest in commodities other than gold. However, a few fund houses have thematic funds which invest in companies engaged in commodity businesses.
Though it’s too early to conclude if AMCs will be allowed to launch commodity funds, some fund officials are hoping that the merger may possibly open the gate for the launch of commodity mutual funds in India.
