'India finally opening up to different investment products': Experts react after SEBI brings in consultation paper on new asset class
The Securities and Exchange Board of India (SEBI) has introduced a consultation paper on a 'New Asset Class' to cater to investors with higher risk-taking capabilities and a higher ticket size.
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This new product is intended to fill the gap between mutual funds and portfolio management services (PMS). With a minimum investment requirement set at Rs 10 lakh, it is designed to be more accessible than PMS, which has a minimum investment of Rs 50 lakh, while still targeting high-net-worth individuals.
The new asset class will allow investments in derivatives for purposes beyond just hedging and rebalancing, giving investors the flexibility to employ various strategies, including long-short equities and inverse ETFs. This move aims to provide higher returns but also comes with increased risk compared to traditional mutual funds.
Industry leaders like Radhika Gupta, CEO of Edelweiss Mutual Fund, and Sandeep Jethwani, Co-Founder of Dezerv, view this development as a significant step towards diversifying investment options in India. They believe it will help investors access a broader range of strategies and potentially enhance wealth creation under a regulated framework.
