Small investors taking the mutual funds route have got a New Year gift from the Securities and Exchange Board of India (SEBI). In an order issued on Monday, the market watchdog scrapped the ‘entry load’ (usually around 2.5 per cent of the amount invested), if investors directly purchased units in a scheme from the fund, without going through agents.
Sebi’s circular said the exemption of entry fee would applicable to investors applying over the Net, submitting forms to the asset management companies of the funds, or to their collection/investor service centres, which are not routed through any distributor/agent/broker. The exemption would apply for investments in existing schemes with effect from January 4, and in new schemes to be launched thereafter.
The last day of 2007 ended well on Dalal Street. The Sensex finished at 20,286.99, 80 points in the green, rising at one point, to within 14 points of its all-time high of 20,498.11. Proving pundits who had predicted that the return on stock market investments may drop to around 10-15 per cent in 2007 wrong, the Sensex rose over 47 per cent for the year — among the fastest in the world. Market capitalisation of Indian stocks doubled, to cross Rs 71,70,000 crore. Foreign investors pumped in over $17 billion, roughly twice the amount they put in during 2006.