New Delhi. Edelweiss Mutual Fund, one of the country’s largest fund houses, has imposed limits on investment in its 7 schemes. These schemes invest in global securities and the limitations will be applicable on them from February 27. This mutual fund house had assets worth about Rs 1.43 lakh crore at the end of the December quarter. The fund house said that some of its schemes have reached close to the foreign investment limit.
Edelweiss Mutual Fund is India’s 13th largest asset management company (AMC). The fund house has informed that it has decided to limit subscriptions through lumpsum, switch-in, systematic investment plans (SIPs), systematic transfer plans (STPs) etc. to Rs 1 lakh per PAN per day, effective from February 27.
Exemption will be available till February 25
According to the fund house, this restriction will be applicable on the basis of transaction reporting date. Apart from this, transactions reported before the cutoff time till February 25, 2025, including switch-in plans. will not be considered for this limit restriction. Existing systematic transactions such as SIPs / STPs etc. will remain unaffected.
The schemes on which Edelweiss has imposed restrictions include Edelweiss ASEAN Equity Off-shore Fund, Edelweiss Greater China Equity Off-shore Fund, Edelweiss US Technology Equity Fund of Fund, Edelweiss Emerging Markets Opportunities Equity Off-shore Fund, Edelweiss Europe Dynamic Equity Off-shore Fund, Edelweiss US Value Equity Off-shore Fund and Edelweiss MSCI India Domestic & World Healthcare 45 Index Fund. Six of these funds are completely focused on foreign securities, while Edelweiss India Domestic & World Healthcare Fund invests in leading companies of India and the United States.
SEBI had issued instructions
The Securities and Exchange Board of India (SEBI) had asked domestic mutual fund companies to stop making further investments in foreign stocks in February 2022. The aim was to prevent violation of the $7 billion limit set by the Reserve Bank of India for investment in foreign securities and funds. The central bank has also set a limit of $1 billion for individual fund houses and $1 billion for investment in foreign exchange-traded funds (ETFs). However, SEBI later allowed mutual funds to invest in foreign stocks, provided their fund allocation complies with RBI limits.
This fund gave bumper returns
According to data from Value Research, China equity funds have given an average return of 55.38 per cent last year, which is till February 21. US-based funds, which include Nasdaq 100, S&P 500 and NYSE Feng, have also given an average return of 26 per cent in a one-year period. Funds investing in global equities have gained 17.48 per cent. Currently, there are about 70 Indian schemes, which have assets under management (AUM) of about Rs 65,000 crore, which invest in schemes focused on themes such as artificial intelligence, emerging technologies, semiconductors and electric vehicles in foreign markets.
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