MFs will now trade on bourses

According to sources,one of the leading stock exchanges and one depository have approached the Sebi to tie up with mutual fund houses to bring this facility to investors. Initially two mutual fund houses have expressed their intent to participate in the sales channel.

Units of mutual fund schemes would be transacted through registered stock brokers of recognised stock exchanges and such stock brokers will be eligible to be considered as official points of acceptance.

The move will definitely increase the reach of mutual fund schemes as this will be another channel for distribution. Fund houses will incentivise brokers for distributing their schemes, said a senior official of an institutional broking house.

Where investor desires to hold units in dematerialised form,demat statements will be issued by depository participants. If investors desire to convert their existing physical units represented by statement of account into dematerialised form,mutual funds shall take such steps in coordination with registrar and transfer agents,depositories and depository participants DPs to facilitate the same, said the Sebi circular.