Market watchdog Securities and Exchange Board of India (Sebi) is cajoling fund houses to consolidate schemes and avoid duplication within the same fund category. However, fund houses may not be in any mood to oblige. This is because having multiple schemes, particularly in lower AUM (asset under management) brackets, helps fund houses to earn higher fees owing to the current AUM-based layered fee structure.
Consider the example of a fund house that has five small-sized equity schemes ..