“We feel there is room for an additional asset class somewhere between mutual funds and PMS… Sebi is looking into a whole new asset class,” Buch told reporters here at the sidelines of a CII event.
In October, mutual funds industry body AMFI clarified that the idea of introducing a new asset class, which lies between mutual funds and PMS, was at a “very nascent stage”.
According to the industry body, there was a deliberation within the industry for an instrument that caters to investors who are looking for an intermediate investment product between mutual funds and PMS.
When asked about the total expense ratio (TER), she said that a lot of back-testing is happening and co-creation is happening.
In May, Sebi floated a consultation paper and proposed a uniform total expense ratio across mutual fund schemes in a bid to bring in transparency in the costs charged to unitholders. TER is a percentage of a scheme’s corpus that a mutual fund house charges towards expenses, including administrative and management.