Sebi banning upfront commissions and upfronting of the trail commissions in mutual funds would stop the practice of unnecessary churning in mutual fund portfolios, especially in B-30 cities, say some wealth managers.
“Many small distributors who are specifically working in B-30 cities survive by churning their clients’ portfolios often. AMCs pay a higher upfront commission on business from B-30 cities. The commissions are higher by 1 to 1.5 per cent. However, after Sebi’s move, distribu ..