‘No need to bring back mutual fund entry load in same form’
There is a lot of regulatory activism over making mutual funds (MF) more attractive. Do you think bringing back entry load will be good for the MF industry?
In the last few weeks, several discussions have taken place in the Finance Ministry over MFs with the various stakeholders. The challenge is how to balance commercial viability of distributors with investor's interest. Now MF agents do not want to service the small investors because of low incentive. However, there is no need to bring the entry-load back. We should move to variable cost model where the fee can be negotiated with the advisor depending on the quality of the advice provided.
There is no strict regulation over the advisory business. The mandatory certifications are product based and not advisory based. Should the focus not be on improving the standard of advisors?
Yes, I think the focus is misplaced. There is a need for setting professional standards for the advisors in the industry. Product certification is not enough. There is no thinking around bridging this gap in the industry. Most investors do not have access to good quality advisors. Most advisors do
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