The Securities and Exchange Board of India (Sebi) has asked all the fund houses to furnish fund performance details. It has specified a standard format across time periods. While, the exact intention of the Sebi is not known, some mutual fund players hint that it is a precursor to a new regulation, on public disclosure of fund performance for the mutual funds .
? Sebi has asked us to provide the scheme details and we will submit it to them? says Achal Kumar Gupta, MD, SBI Mutual Fund. He refused to comment on the regulator’s intentions . ?Sebi is looking at more qualitative disclosures going forward ,? said another CEO.
A Sebi letter to a fund house asked them to provide returns of equity, debt, balanced and ETF for six months, 1-year, 3-year, 5-years as well as since inception by August 10. Scheme details on underperformance/outperformance vis-a-vis market indices as well as other sophisticated fund performance measures like volatility, risk adjusted return, beta of the scheme and portfolio turnover were solicited. ? If new regulation is introduced with such fund information, it will be an investor friendly move as returns of a scheme alone do not define its performance? said a senior official from a fund house. Such details would help prospective investors evaluate whether fund manager is sticking to the fund investment mandate in spirit as disclosed in its offer document.
Half yearly data shows that many equity schemes rapidly churn portfolio ? often to the extent of 100%. This implies an investment horizon of one year for fund managers as investors are advised to stay put for 2-3 years.