Subscribe to Updates

    Get the latest creative news from FooBar about art, design and business.

    What's Hot

    3 Ways to Make More Through Franchising

    March 28, 2023

    Nawazuddin Siddiqui files Rs. 100 crore defamation case against his brother and estranged wife : Bollywood News

    March 28, 2023

    Shah Rukh Khan Compared To Mumbai, Salman Khan Representing Delhi

    March 27, 2023
    Facebook Twitter Instagram
    Facebook Twitter Instagram
    Forbes Magazine
    Subscribe
    • Home
    • Bollywood
    • Hollywood
    • Entertainment

      Shah Rukh Khan Compared To Mumbai, Salman Khan Representing Delhi

      March 27, 2023

      Shraddha Kapoor & Aditya Roy Kapur’s ‘Enna Sonna’ Video Montage Is Making The Netizens Cry For Their Comeback; One Says “Ananya Panday Ka Long Term Nahi…”

      March 27, 2023

      Alia Bhatt’s “If Taylor Swift Was In India, She’d Be Totally Shamed For Dating Multiple Men” Comment Resurfaces, Swifties Have Declared A War Against The Actress!

      March 26, 2023

      “Hollywood Is Far Ahead Of The Rest Of The World…”

      March 26, 2023

      “Mere Kaan Bajj Rahe Hai”

      March 25, 2023
    • Interviews
    • Lifestyle

      Kindle, Kobo, Nook, iPad – The Hollywood Reporter

      December 8, 2022

      ‘KPOP’ Closing on Broadway in December – The Hollywood Reporter

      December 7, 2022

      1-800 Baskets, Wiliams Sonoma – The Hollywood Reporter

      December 6, 2022

      Armageddon Time, Bones and All Costume Designers on Bringing ‘80s Style Back – The Hollywood Reporter

      December 5, 2022

      Keke Palmer Announces Pregnancy in ‘SNL’ Opening Monologue – The Hollywood Reporter

      December 4, 2022
    • Business

      3 Ways to Make More Through Franchising

      March 28, 2023

      5 Steps For CEOs To Become Sales Masters

      March 27, 2023

      JPMorgan Chase CEO Jamie Dimon is getting involved in rescuing banks again

      March 25, 2023

      What Makes Powerful Passports In The World

      March 25, 2023

      How to stop doubting yourself?

      March 24, 2023
    Forbes Magazine
    Home»Business»Sebi Caps PMS Investment In Securities of Related Parties, Bats For Proper Disclosure
    Business

    Sebi Caps PMS Investment In Securities of Related Parties, Bats For Proper Disclosure

    AuthurBy AuthurAugust 27, 2022No Comments4 Mins Read
    Facebook Twitter Pinterest LinkedIn Tumblr WhatsApp VKontakte Email
    Share
    Facebook Twitter LinkedIn Pinterest Email

    The Securities and Exchange Board of India (Sebi), in a circular released on August 26, has notified frameworks regarding investments by portfolio management scheme (PMS) service providers. The move will ensure proper disclosure to investors, cap over-exposure to investments in securities of related parties and ensure most of the investments are done in quality securities.

    The amended frameworks for PMS providers will come into effect from September 20.

    These rules will, however, not be applicable for advisory portfolio management services, co-investment portfolio management services companies, and those companies that manage funds under government mandates.

    Munish Randev, founder and CEO, Cervin Family Office and Advisors, said in a statement, “We always welcome regulations that safeguard the interests of the investor, both large or small. The new rules allow the investor more control over any ‘conflicted investments’ by the PMS manager.  We are just worried that some managers may just sneak in the initial approval for related party investments in the paperwork for new clients without clearly highlighting that to the client.”

    Here are the amended frameworks that Sebi has notified:

    Limits On Investment In Securities Of Associates/Related Party

    Sebi, in the circular, said that portfolio managers shall invest up to a maximum of 30 per cent of their client’s portfolio in the securities of their own associated or related party.

    Sebi further classified and laid down limits for individual securities.

    In the equity asset class, the limit for investment in a single associated or related party shall be 15 per cent of the client’s assets under management (AUM). The limit for investment across multiple associates or related parties shall be 25 per cent of the client’s AUM.

    For debt and hybrid securities, the limit for investments in a single associated or related party shall be 15 per cent, and for multiple associates or related parties, 25 per cent.

    As per the classification of Sebi, hybrid securities include real estate investment trusts (REITs), infrastructure investment trusts (InvITs), convertible debt securities and other securities of similar nature.

    The overall limit for equity, debt and hybrid securities shall be 30 per cent.

    The limits mentioned “shall be applicable only to direct investments by Portfolio Managers in equity and debt/hybrid securities of their own associates/related parties and not to any investments in the Mutual Funds”, specified Sebi.

    Prior Consent Of Clients

    To be able to make investments in the securities of associates or related parties, portfolio managers will need the prior consent of the client at the time of onboarding. Even for existing clients, fresh investments in such securities can be made only after obtaining consent from the client.

    Sebi made it clear that the consent form should also “have an option to indicate dissent”.

    Portfolio managers will need to document the following records related to consent:

    a) Prior positive consent or dissent, as the case may be.

    b) Instances of the passive breach of investment limits, if any.

    c) Steps taken, if any, to rectify the passive breach of investment limits.

    d) Waiver obtained from the client regarding rebalancing in the event of a passive breach of investment limits.

    “Needless to say that all such investor-friendly regulations need to be well-communicated so that all types of investors can benefit from better regulations,” said Randev in a statement.

    Credit Rating of Investments By Portfolio Managers

    Portfolio managers shall not be allowed to invest funds of their clients’ funds “in unrated securities of their related parties or their associates”.

    Both in case of discretionary and non-discretionary portfolios, managers shall not make any investment in below investment grade securities, said the circular.

    However, managers may invest “up to 10 per cent of the assets under management of such clients in unlisted unrated securities of issuers other than associates/related parties.”

    Disclosures

    Portfolio managers will have to provide their clients with a disclosure document with all the details of investments in related parties or associates, rectification policy and credit ratings of investments in debt and hybrid securities.

    Share. Facebook Twitter Pinterest LinkedIn Tumblr WhatsApp Email
    Previous ArticleBitcoin Falls 6%, Ethereum Dips 9% Amid Sell-off Pressure
    Next Article Chandigarh, Delhi, Punjab Have Highest Number Of Rich People; Half Of Rural India Poorest
    Authur
    • Website

    Related Posts

    3 Ways to Make More Through Franchising

    March 28, 2023

    5 Steps For CEOs To Become Sales Masters

    March 27, 2023

    JPMorgan Chase CEO Jamie Dimon is getting involved in rescuing banks again

    March 25, 2023

    What Makes Powerful Passports In The World

    March 25, 2023

    Leave A Reply Cancel Reply

    Demo
    Our Picks
    • Facebook
    • Twitter
    • Pinterest
    • Instagram
    • YouTube
    • Vimeo
    Don't Miss
    Business

    3 Ways to Make More Through Franchising

    By AuthurMarch 28, 20230

    Without a doubt, the franchise industry offers a great opportunity to earn a living. According…

    Nawazuddin Siddiqui files Rs. 100 crore defamation case against his brother and estranged wife : Bollywood News

    March 28, 2023

    Shah Rukh Khan Compared To Mumbai, Salman Khan Representing Delhi

    March 27, 2023

    Singer Bebe Rexha Receives Used Toilet Paper In Mail, She Expresses Her Disgust!

    March 27, 2023

    Subscribe to Updates

    Get the latest creative news from SmartMag about art & design.

    Forbes Magazine
    Facebook Twitter Instagram
    • Home
    • Business
    • Entertainment
    • Lifestyle
    © 2023 Forbes Magazine.

    Type above and press Enter to search. Press Esc to cancel.