Circular on the Development of Passive Funds
Circular on the Development of Passive Funds
- Considering the emergence of passive funds i.e. Exchange Traded Funds (ETFs) and Index Funds as an investment product for retail investors globally and various advantages of passive investing like transparency, diversification, lower cost vis-à-vis active funds, a need was felt to review the regulatory framework for passive funds in India. In this regard, a Working Group (WG)was constituted with representation from various stakeholders in the passive funds’ domain like AMCs, Mutual Fund Trustees, Stock Brokers,Market Makers, Stock Exchanges, Clearing Corporations,Industry Expert, etc.
- The recommendations of the Working Group and the feedback received from the industry were deliberated in the Mutual Funds Advisory Committee (MFAC). Consideringthe recommendations of MFAC, the following have been decided:
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