Securities and Exchange Board of India

  • 18 May 2024

On 17th May, 2024, Securities and Exchange Board of India (SEBI) suggested allowing domestic mutual funds to invest in overseas funds with limited exposure to Indian securities.

  • Currently, SEBI registered mutual funds have various options for investing in overseas securities.
  • Overseas funds' exposure to Indian securities should not exceed 20% of their net assets.
  • Indian securities offer attractive investment opportunities for foreign funds due to India's strong economic growth prospects.
  • Examples include the MSCI Emerging Markets Index (MEMI) and JP Morgan's 'Emerging Markets Opportunities Fund'.
  • MEMI's exposure to Indian securities has steadily increased over the years.
  • Proposed measures include an observance period for monitoring portfolio rebalancing and ensuring transparency in portfolio disclosure by overseas funds.