Sign of relief for mutual fund investors due to reduction on duty

With the reduction of the duty imposed on market regulator SEBI's investors, the investment in the mutual fund would be cheaper. On the other hand, margins of property management companies may be affected. Experts said this on Wednesday.

Indeed, SEBI has approved the proposal to bring a comprehensive change in the fee structure of the mutual fund. Under this, the maximum total expenditure ratio (TER) for fixed-term equity schemes (closed-ended equity scheme) has been kept at 1.25 percent. That's a percentage for other plans. TER is the fee that the mutual fund companies receive from investors for managing their capital.

The maximum TER for open-ended equity schemes will be 2.25 percent for continuous open equity schemes and 2 percent in the case of other open continuing plans.

The investors will surely benefit from this because the cost of investment in mutual funds will be lower. In addition, these steps will bring transparency in the industry.