Can anyone here please explain how exactly the stress tests on mid/small cap MFs work? I came across this article on forbesindia, which kind of suggests MFs are actually having to pro rata sell 25% / 50% of their portfolios. Can a pro rata test result during normal times have any semblance to how a 50% liquidation would actually pan out during a panic sell-off?
There was some specific criteria regarding volume.
Read up on the methodology here. It is by Bandhan MF. I found it good
2 Likes