Nippon India Mutual Fund has again suspended inflows into five of its schemes investing in the international markets within a week after reopening it, Business Line reported.
There are speculations that other fund houses, which had opened up investment in overseas schemes, may also follow suit given renewed investors’ interest in these schemes.
Securities Exchange Board of India (SEBI) had capped the individual mutual fund investment limit in the overseas market at February-level, as the overall limit for the industry was inching closer to $7 billion set by the RBI.
However, with the sharp fall in the international markets, fund houses were allowed to make investments in overseas funds and securities up to the headroom available without breaching the overseas investment limits as of February 1 at the fund house level.
Accordingly, Nippon India MF schemes (NIMF) investing in overseas securities were opened up for investment from June 22. However, post the resumption of the subscription in certain NIMF schemes investing in overseas securities, there has been substantial utilisation of available overseas investment limit.
Therefore, with a view to avoid breach of the overseas investment limit the fund house has suspended all investment avenues including lump-sum in Nippon India US Equity Opportunities, Japan Equity, Taiwan Equity, Multi Asset Fund and ETF Hang Seng BeES from Wednesday.
Incidentally, Edelweiss Mutual Fund and PGIM India also reopened their overseas mutual fund schemes last week.
Edelweiss MF had opened up fresh investment in seven of its schemes, while PGIM India also started accepting all kind of fresh investment in three of its international funds.