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Participation in derivative markets by Mutual Funds

Participation in derivative markets by Mutual Funds

Circular dated 20.02.2017

  • Existing Schemes of Mutual Funds whose Scheme Information Documents (SIDs) do not envisage investment in derivatives are allowed to do so subject to fulfillment of the following conditions:
  •  The extent and manner of the proposed participation in derivatives shall be disclosed to the unit holders.
  • The risks associated with such participation shall also be described with suitable examples.
  • All the unit holders shall be given at least 30 days exit option without any exit load prior to commencement of trading in derivatives.
  • SEBI circular no. DNPD/Cir-29/2005 dated September 14, 2005 is hereby altered accordingly.

 

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