Market regulator Securities and Exchange Board of India (Sebi) allowed mutual funds to participate in the commodity derivative market only through exchange-traded commodity derivatives.
CNBC-TV18 spoke to Harshvardhan Roongta, the chief financial planner of Roongta Securities, about the development.
“The guidelines were much awaited as we have already discussed it. The idea is that an investor should have an opportunity to invest in different products. It could be even commodities for that matter,” Roongta said on Wednesday.
“The other thought is if I am allowed to invest under the regulated guidelines, it becomes much easier for me and it is also going to be professionally managed. So if an investor wishes to expose himself to this kind of investment it should be an opportunity available. Now the question is clear disclosure, well-regulated guidelines should be in place and the investor should be made aware that in case if you are going for a hybrid scheme, for instance, there is going to be some exposure into commodities. If you are going into a multi-asset scheme offered by the mutual funds there is going to be up to 30 percent exposure so with these disclosures an investor is well informed and he is taking a calculated decision saying that I wish to invest into a commodity so I am investing into this particular scheme. I think is a very progressive step giving another option to investors to choose the product,” Roongta added.
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