Disclose details for direct, regular mutual fund plans separately, orders Sebi

Markets regulator Sebi on Tuesday introduced separate disclosure requirements for expenses, half-yearly returns, and annualised yields in both direct and regular mutual fund (MF) plans, along with a colour-coded system for the existing risk-o-meter.

Aimed at improving investor protection and providing clarity around MF disclosures, these requirements will become effective from December 5. It will allow investors to easily compare the cost and performance of the two types of plans.

In a circular, Sebi directed MFs to separately disclose expenses, half-yearly returns, and annualised yields for direct and regular plans. The Association of Mutual Funds in India (AMFI) will standardise these formats with Sebi.

Sebi has introduced a colour-coded system for the existing risk-o-meter. In case of any changes in a scheme’s risk-o-meter level, MFs have been asked to inform investors of risk-level adjustments through email or SMS and display the current and revised risk levels in these notifications.