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Wednesday, May 25, 2022

Parag Parikh Long Term Equity Fund

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The identity of Parag Parikh Long Term Equity Fund has changed. This scheme is classified into Flexi Cap Fund. Now it will be known as Parag Parikh Flexi Cap Fund. Flexi cap funds have the freedom to invest in shares. They can invest in large cap, mid cap and small cap all.

Neil Parag Parikh, chairman and CEO of PPFAS Mutual Fund, said, “We have changed our flagship scheme after necessary approvals following all the rules.” However, there has been no change in the portfolio and investment process. ”

Parikh said that the scheme will continue to manage the money collected from investors as before. The Flexicap strategy will facilitate the fund manager to invest. They will be able to invest money wherever investment opportunities appear without any control.

In September, market regulator Sebi changed investment rules for multicap schemes. Only after this, necessary changes have to be made in Parag Parikh Long Term Equity Fund. According to the new regulations of SEBI, it has become necessary for multi-cap schemes to invest at least 25-25 per cent of their portfolio in large-cap, mid-cap and small-cap stocks of all three categories. Before this there was no such restriction for multi-cap schemes. She could invest in any market cap and sector. This decision was made at the discretion of the fund manager.

Most mutual fund managers and investment experts believe that the risk profile of multicap schemes will change after the new regulations by SEBI. These will no longer be suitable for equity investors holding moderate risk. He says that this category has become extremely risky due to the imperative of at least 50 per cent investment in mid and small cap.

SEBI has launched a new category named Flexi Cap. This category is like the earlier multicap category. Many fund houses are considering moving their multi-cap schemes to a new category. In the last one month, many big fund houses have already reclassified their multicap schemes.

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