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FIIs sell shares worth Rs 910 cr

index includes oil-marketing companies like HPCL, BPCL, and IOC, which have been laggards in the index due to losses made by them because of increasing crude oil prices. The oil and gas index touched its high of 14,051 on January 8, 2008 and then subsequently decline by around 40% to 10,021 points on March 13, 2008 due to the overall market correction. The decline was also because of rapid decrease in the price of Reliance packs scrips.

Policy changes

In this massive corrective period we also saw a couple of changes in the mutual fund industry. We saw changes in the regulation in respect of a waiver of entry load for direct investors. This would not have significantly affected the performance of the funds.

Another change which happened recently was removal of amortisation of marketing expenses. It means that the expenses incurred on the new fund offer will be a one-time deduction before the net asset value is published after the launch. This particular change was applicable only for close-ended funds. The NAV will decline and go below Rs 10, which was not the case before the change.

The change, being a one-time exercise, would bring more transparency in the NAV prices because previously investors were not aware about the amortisation and the returns would decline equal to amortisation percentage.