Loading ...
 
     
 
  Latest NAVs___Average AUM___Announcements___Search___Contact Us___About Us___Site Map___Home  
 
 

Press Release
 
 
INVESTORS CAN NOW MAKE PROPER EVALUATION OF PERFORMANCE OF DEBT AND BALANCED FUND SCHEMES
EIGHT NEW INDICES LAUNCHED BY G.N.BAJPAI, CHAIRMAN, SEBI

Shri G. N. Bajpai, Chairman, SEBI today launched 8 new market indices as benchmarks for evaluating the performance of debt and balanced fund schemes of mutual funds. These indices are specially designed and constructed by Crisil.com and ICICI Securities in consultation with AMFI.

 
An Important Initiative of SEBI and AMFI

The need for benchmarking the performance of mutual fund schemes

The new Indices

Mutual Funds to use the market Indices while presenting performance evaluation reports

 
 

A Important Initiative of SEBI and AMFI

Shri Bajpai mentioned that this is a major and unique initiative taken by SEBI alongwith AMFI to provide a scientific tool for investors, distributors and analysts for evaluating the performance of different types of mutual fund schemes. He mentioned that internationally only very few countries have mandated the use of market indices for benchmarking the performance of mutual fund schemes. In this respect, both the Regulator and the mutual fund industry as represented by AMFI could feel happy to have taken this initiative in the best interest of investors.

 
 

The need for benchmarking the performance of mutual fund schemes

In his welcome address Shri A. P. Kurian, Chairman, AMFI mentioned that for understanding and evaluating the performance of mutual fund schemes, they need to be compared with appropriate market indices that would broadly represent the underlying investment instruments. He complimented SEBI for mandating the use of appropriate indices while presenting performance reports. Currently equity indices are used to benchmark the performance of equity-oriented schemes. However, there are no such appropriate market indices to benchmark the performance of different types of debt schemes such as liquid, income and monthly income and balanced fund schemes. AMFI therefore took the initiative of developing new indices jointly with Crisil.com and ICICI Securities. An AMFI committee headed by Shri Shailendra Bhandari of Prudential ICICI worked along with Crisil.com and ICICI Securities and evolved the principles and methodology for constructing the new indices. The launching of new indices as a result of the joint efforts of AMFI, Crisil.com and ICICI Securities according to Shri Kurian is a unique event in the market and he hoped that distribution houses, agents, financial consultants and banks engaged in the marketing of mutual fund schemes and the investors would increasingly use these market indices to evaluate the performance of mutual fund schemes.

 
 

The new Indices

Following are the 8 new market indices:

Sr. No. Name of the New Index Designed and Constructed by For benchmarking the performance of
1. Liquid fund Index [Liquifex] Crisil.com Liquid funds
2. Composite bond fund index [Compbex] " Income/Bond Funds
3. Balanced Fund Index [Balance EX] " Balanced Funds
4. MIP Index [MIPEX] " Monthly Income Plan Schemes
5. Short maturity gilt index [Si-BEX] ICICI Securities Gilt Schemes of short maturity
6. Medium Maturity gilt index [Mi-BEX] ICICI Securities Gilt schemes of medium maturity
7. Long maturity gilt index [Li-BEX] " Gilt schemes of long maturity
8. Composite gilt index " Composite gilt schemes

The above indices will be constructed by Crisil.com and ICICI Securities on a daily basis and released from today on AMFI website www.amfiindia.com by around 6.00 P.M everyday. Shri Ravi Mohan, Managing Director, Crisil, felt that the scientifically designed indices would greatly enhance the value of performance evaluation of mutual fund schemes a subject in which Crisil.com, a leading fund ranking firm, has been doing intense research and study. He welcomed the opportunity Crisil.com got to construct the new indices. Shri Devdatt Shah, Managing Director and CEO, ICICI Securities mentioned that ICICI Securities, a major participant in the Government securities market, has already pioneered the construction of sovereign bond index (IBEX) and now they are happy to collaborate with AMFI in developing segment specific gilt indices to suit the needs of mutual fund schemes. Shri Mukarram Bhagat, Chief Executive Officer, Crisil.com and Shri Devdatt Shah, Managing Director and CEO, ICICI Securities made presentations on the design of the new indices. They explained the underlying principles, the weightage assigned to each constituent of the indices, source of data, methodology etc.

 
 

Mutual funds to use the market indices while presenting performance evaluation reports

As per SEBI guidelines mutual funds are required to disclose the performance of schemes during the last six months, 1year, 3 years, 5 years and since the date of launch of the schemes while publishing their half yearly results. Mutual funds have now to disclose also the performance of the appropriate market indices alongwith the performance of schemes both in the offer document and in the half yearly results. Further, the Trustees are required to review the performance of the schemes on periodical basis with reference to the market indices. Shri Kurian mentioned that AMFI registered Mutual fund advisors should make use of these significant and very useful indices for properly comparing and evaluating the performance of different fund schemes and thus help the investors and others to keep a track on the performance and also to make proper investment decision.

 
 
MUMBAI
June 19, 2002

 
Press Release Home ||  New Indices ||  About Mutual Funds ||  AMFI'S Mutual Fund Year Book
AMFI’S Certification Programme ||  AMFI's New Initiative ||  Certification in Regional Languages
AMFI’S Certification Programme For Distributors ||  Hindi Edition of AMFI Workbook 
Press Release Archive

 
 
© Association of Mutual Funds in India (AMFI) - Copyright 2019
Site Developed By - Chatur Computer Services Pvt. Ltd.
www.chatur.com
Disclaimer
The Information provided on the AMFI website is based on the information provided by the members. As such AMFI does not take any responsibility for its accuracy, completeness and timeliness.