As the June 30 deadline to comply with SEBI’s diktat comes closer, a few fund houses have started publishing additional scheme related disclosures mandated by SEBI on their websites. Fund houses had sought an extension from May 1 to June 30 from SEBI to comply with this circular.
On March 18, SEBI had come out with a circular which mandated AMCs to illustrate the impact of expense ratio on scheme’s returns, among other things. As a part of this disclosure, AMCs will start providing the details of TER of each scheme with of direct plans and their returns (1 year, 3 year, 5 year and since inception). Investors will also get to see each scheme’s portfolio holdings (top 10 holdings by issuer and fund allocation towards various sectors).
The regulator has mandated these disclosures for greater transparency and allow ease of access to scheme information for investors. Distributors say that while transparency is good, such additional disclosures may not actually help investors take an informed decision. By investing in direct plans, the investor could be losing out on valuable advice from experts. In the long run, this advice may be the crucial determinant on how and whether the investor reaches his goals, say distributors.
From now, AMCs will start providing separate SID/KIM for each MF scheme on their websites. This disclosure will contain the tenure for which the fund manager has been managing the scheme, name of scheme’s fund manager, scheme’s portfolio turnover ratio and the expense ratios of underlying schemes of fund of fund schemes.
To let investors know about how much skin in the game AMCs have, SEBI had also asked AMCs to disclose the aggregate investment of AMCs Board of Directors, fund managers and other key personnel in the schemes in scheme information documents. PPFAs Mutual Fund was one of the first fund houses to disclose this data voluntarily.
