sebi: Sebi amends rules for portfolio managers’ investments in ‘associates’

Markets regulator Sebi on Friday said portfolio managers can invest a maximum of 30 per cent of client assets in securities of their ‘associates’ or related parties.

This comes after Sebi on Monday amended rules for portfolio managers, mandating prudential limits on investments in portfolio managers’ associates and related parties, requiring prior consent of customers for such investments and based on the credit rating of securities. ban on.

The regulator has defined “associate” as a body corporate in which a director or partner of a portfolio manager, individually or collectively, holds more than 20% of its paid-up equity share capital or partnership interest.

“Portfolio Managers shall invest a maximum of 30% of their client’s portfolio (as a percentage of client’s assets under management) in securities of their own associates/related parties,” Sebi said in a circular.

With respect to investments in equity, debt and hybrid securities, the regulator has capped 15% for investments in a single associate or related party, while it has been fixed at 25% for investments in multiple associates or related parties.


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