Markets regulator Sebi revamped the product labeling on mutual fund schemes under the risk-o-meter by introducing a "very high risk" category to warn investors.
The existing five categories to measure risks are - low, low to moderate, moderate, moderately high, and high.
Based on the scheme characteristics, mutual funds will assign a risk level for schemes at the time of launch of scheme/new fund offer, Securities and Exchange Board of India (Sebi) said in a circular.
It further said any change in risk-o-meter will be communicated by way of notice-cum-addendum and by way of an e-mail or SMS to unitholders of that particular scheme.
To talk about these new rules, CNBC-TV18’s Sumaira Abidi spoke to Radhika Gupta, managing director, and chief executive officer of Edelweiss Asset Management.
Also, watch Shweta Rajani, senior vice president, and head (Mutual Funds) at Anand Rathi Private Wealth Management answer viewers' queries.