New Delhi: Asset management company Motilal Oswal Mutual Fund is all set to reopen two international schemes, Motilal Oswal Nasdaq Q50 ETF and Motilal Oswal Nasdaq 100 ETF, for subscription or manufacturing of units from Monday.
To ensure this, the two exchange-traded funds (ETFs) will be opened only to authorized participants or market makers from September 19 until further notice.
Liquidity in ETFs is created by market-makers called authorized participants, who are pre-appointed by AMCs to improve ETF liquidity.
In February, the Securities and Exchange Board of India (SEBI) had advised mutual funds investing in foreign securities to stop further investment in foreign stocks to avoid breaching industry-wide foreign limits.
The regulator has specified an aggregate industry limit of $7 billion for mutual funds to invest in foreign securities and funds, and a separate limit of $1 billion for investments in foreign ETFs.
The Association of Mutual Funds in India (Amfi) had notified in June that mutual fund schemes may resume subscriptions and invest in foreign funds/securities till the available headroom, without violating the foreign investment limit, till February 1, 2022. .
Motilal Oswal Mutual Fund said in a notice, “Now, as we have available headroom, we are reopening direct manufacturing in Motilal Oswal Nasdaq Q50 ETF and Motilal Oswal Nasdaq 100 ETF only to authorized participants/market makers ”
“We will monitor regulatory limits and once headroom is limited, we will have to restrict membership again”.
Investors should note that fund houses Motilal Oswal S&P 500 Index Fund, Motilal Oswal Nasdaq 100 ETF Fund of Funds and Motilal Oswal MSCI EAFE Top 100 Select Index Fund continue with restrictions on subscription, purchase or SIP.
The fund house also highlighted that it is continuously engaging with the regulator to increase the foreign investment limit by mutual funds.
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