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MF Corner: What to do with foreign focused funds? Here's what experts suggest

On the 30th of January, the Association of Mutual Funds of India sent out an advisory to all asset management companies to stop fresh purchases of stocks overseas, because the industry-wide limit of $7 billion had been hit. This means that all mutual funds combined, could invest up to $7 billion in buying foreign stocks for their schemes, and the various funds now had reached this cap collectively. CNBC-TV18 spoke to Mohit Gang, CEO, and Co-Founder at Moneyfront, and Prableen Bajpai, founder of Finfix Research to understand the fate of these schemes and their investors.

By Sumaira Abidi Feb 3, 2022 3:23:56 PM IST (Updated)

Listen to the Article(6 Minutes)

On the 30th of January, the Association of Mutual Funds of India sent out an advisory to all asset management companies to stop fresh purchases of stocks overseas, because the industry-wide limit of $7 billion had been hit. This means that all mutual funds combined, could invest up to $7 billion in buying foreign stocks for their schemes, and the various funds now had reached this cap collectively. So to continue to keep buying, they have now petitioned the Reserve Bank to increase this limit upwards. However, we are still waiting for any announcement on that front.

In the meantime, nearly 50 schemes across 14 AMCs that had foreign mandates have stopped taking in fresh money, in fact, two have even stopped existing SIPs.

CNBC-TV18 spoke to Mohit Gang, CEO, and Co-Founder at Moneyfront, and Prableen Bajpai, founder of Finfix Research to understand the fate of these schemes and their investors.

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