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Market regulator SEBI has directed DSP Global Innovation Fund of Fund to initially invest only in overseas ETFs until the overall overseas investment limit for mutual funds is increased from $7 billion in consultation with the RBI.
SEBI has specified an industry level limit of $7 billion for MFs to invest in overseas securities and mutual funds and a separate limit of $1 billion for investment in overseas Exchange Traded Funds.
While the overseas ETF investment is yet to hit the limit, other international strategies have seen healthy flows and investments in overseas securities and mutual funds is close to hit the overall cap of $7 billion. Hence, SEBI on Sunday ordered DSP Global Innovation Fund to invest only in overseas ETFs.
Incidentally, the new fund offer of DSP Global Innovation Fund opened for subscription on Monday and closes on February 7.
Innovation the focus
DSP has been promoting systematic investment plan in Global Investment Fund which will focus on innovation as its key driver and identifies companies that have innovative thinking at their core. The fund will invest in emerging innovation themes such as Metaverse, Semiconductors, Blockchain, 5G, Gene Technology, Artificial Intelligence, Space Exploration, Electric Vehicles and Robotics, among others.
Investors pump in about ₹12,000 crore every month through SIP. Of this, inflow in global Fund of Funds are just about ₹200 crore.
DSP Global Innovation Fund of Fund will begin by investing in two passive funds, iShares PHLX Semiconductor ETF & iShares Nasdaq 100 UCITS ETF as advised by the industry regulator. Once the overseas investment limit for the Indian MF industry is enhanced, the fund also propose to invest in unique active strategies like BlueBox Global Technology Fund, Nikko AM ARK Disruptive Innovation Fund, Morgan Stanley US Insight Fund & BGF World Technology Fund and other overseas fund with Innovation theme, said the fund house.
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