by Dileep Ramachandran, Mutual Funds
08 Jun , 2018

New Solution Oriented and Other Mutual Fund Classification by SEBI

New Solution Oriented and Other Mutual Fund                              Classification by SEBI

On October 2017, Securities and Exchange Board of India (SEBI) released a new circular to rationalize and categorize the Mutual Funds in India. The main aim of the circular is to standardize the scheme of all the categories. There are 36 sub categories under the main categories (Equity, Debt, Hybrid, Solution Oriented and other).

According to the circular “Mutual Fund Categorization and Rationalization”, the categories as follows.

Equity Schemes-investment in equity and equity related instruments

Debt Schemes-investment in debt instruments

Hybrid Schemes-investment in a mix of equity, debt and other assets

Solution Oriented Schemes-retirement or children savings scheme

Other Schemes-Index Funds, Fund of Funds and ETFs

Solution Oriented and Other Scheme Sub Categories

Solution Oriented Schemes

1.  Retirement Fund-Scheme having a lock-in for at least 5 Years or till retirement age whichever is earlier.

2.  Children’s Fund-Scheme having a lock-in for at least 5 Years or till the child attains age of majority whichever is earlier.

Other Schemes

1.  Index Funds/ETFs- Minimum investment in securities of a particular index (which is being replicated /tracked)-95% of total assets.

2.  FOFs(Overseas/Domestic)-Minimum investment in the underlying fund-95% of total assets

 About The Author

Dileep Ramachandran, Research Analyst with more than 4 years of total experience in the area of Equity and Mutual Fund Research.


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