Fortnight portfolio disclosure by debt MFs to bring transparency: Experts

Markets regulator Sebi's move, which mandates debt mutual funds to disclose portfolio of their schemes every fortnight, will bring in more transparency and win investors confidence, industry experts said on Thursday. In addition to the portfolio disclosure, yield of the instrument will also be disclosed.

"This is in right direction, more disclosures and transparency will help win investors confidence that was dented due to difficult couple of years for debt funds," Omkeshwar Singh, Head - RankMF at Samco Group, said.

Vidya Bala, co-founder of PrimeInvestor.in said, "Disclosure of papers every fortnight can help alert investors to papers that are downgraded by a notch or two (that may not significantly impact net asset value) and may not come to light until much later".


Further, the disclosure can also make investors aware about papers traded during the course of a month to shore up returns sometimes, she added.

Currently, mutual funds are required to disclose portfolio of schemes as on last day of the month before 10th day of the succeeding month.

Starting October 1, the disclosure for debt funds will be fortnightly basis within 5 days of every fortnight, according to a Sebi circular.

Additionally, yield of each and every debt instrument in the portfolio needs to be disclosed which was not required to be disclosed earlier.

"Disclosure of yield of individual papers will help get a better sense of the risks in the papers," Bala said.

To increase transparency and customer confidence, PGIM India MF said it had started daily disclosure of its short maturity debt portfolios last month itself.

The schemes currently covered under daily disclosure are PGIM India, Overnight, PGIM India Insta cash, PGIM India Money Market and PGIM India Ultra Short term Fund.