Introduction of credit risk based single issuer limit for investment by mutual fund schemes in debt and money market instruments

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..... f Trustees of Mutual Funds/ All Association of Mutual Funds in India (AMFI) Dear Sir / Madam, Sub: Introduction of credit risk based single issuer limit for investment by mutual fund schemes in debt and money market instruments 1. As per Regulation 44(1) read with clause 1 of Seventh Schedule of SEBI (Mutual Funds) Regulations, 1996 ( MF Regulation ), a mutual fund scheme shall .....

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..... t has been decided to introduce a similar credit rating based single issuer limit for actively managed mutual fund schemes. 4. Accordingly, within the limits specified in the clause 1 of Seventh Schedule of the MF Regulation, following prudential limits shall be followed, for schemes other than Credit risk funds: i. A mutual fund scheme shall not invest more than: a. 10% of its NAV in .....

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..... r a given short term rating. Exposure to government money market instruments such as TREPS on G-Sec/ T-bills shall be treated as exposure to government securities. 6. The circular shall be applicable for all the new schemes to be launched with effect from date of issuance of the circular. Existing schemes shall be grandfathered from these guidelines till the maturity of the underlying debt and .....

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