As you must be aware that SEBI released a circular in October 2017 for Categorization and Rationalization of Mutual Fund Schemes. Details
While some mutual funds have just renamed for the namesake, while the objective, the strategy has changed for the others.
Also, it might happen that with the reclassification of Mutual Funds, there might be duplication in your portfolio
e.g. you already had a “Mid-Cap fund” and the other fund in your portfolio which was “Small and Mid-Cap” earlier has now become Mid Cap. So two Mid-Caps now in your portfolio.
You may not like the new fund objective or it might not match to your investment goals.
This is important for an investor to relook what has changed, analyze whether they fit to their goals or not.
Where can I get a readily available list of Before and After reclassification of mutual funds?
I am googling here and there and the official websites of these Mutual Funds are keeping mum on this.
On a few web articles, I read that SEBI is allowing to make a switch in case your fund has been reclassified and either you don’t like the new strategy or it does not align with the strategy you started investing in that mutual fund before the changes happen.
I read that SEBI is allowing to switch funds within “16 April - 15 May” without charging any exit load.
Now if this is true, then this is very interesting and important for an investor to pivot, if need be.
Can any expert confirm this and guide where to find the answers to #1 and #2.
AMCs have been mandated to provide a one month period during which investors can exit the fund with no exit load. Nor sure if it is a fixed date for all funds because quite a few AMCs are yet to complete the reclassification process.
Hi Sanket, good to talk to you after long.
Yes, I have been digging the AMC websites since yesterday for details. Have been sharing my findings on this thread.
To note is, every fund has different switch w/o exit load period. So we have to carefully analyze and act.
You may have to visit the official AMC website to know detailed changes in attributes in your Mutual Fund scheme and the switch without exit load period, which is not a fixed date and vary from one mutual fund to another. Accordingly, take a wise decision.
I want to know, in such cases of scheme changes whether the holding period for tax purpose will be calculated from date of original investment or from date of scheme name change? In other words will gains on redemption be taxed as short term or long term?
I am holding Reliance Equity Opportunities Fund which has been renamed Reliance Multi Cap Fund from 28-04-2018.
I want to redeem my investments made more than a year ago in above scheme and also other such schemes where changes have been made.