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TMI BlogDisclosure of Risk adjusted Return - Information Ratio (IR) for Mutual Fund Schemes.X X X X Extracts X X X X X X X X Extracts X X X X ..... /Madam, Subject: Disclosure of Risk adjusted Return - Information Ratio (IR) for Mutual Fund Schemes. 1. The extant provisions of the SEBI (Mutual Funds) Regulations, 1996 (hereinafter referred to as MF Regulations ) and Master Circular specified thereunder inter alia mandate filing of periodic information regarding schemes performance by AMCs. Apart from the same, appropriate disclosures pertaini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosures made by AMCs and aid better decision making by investors, proposed disclosure of IR as a financial metric to measure the RAR of a scheme portfolio, was placed for public consultation and deliberated in Mutual Funds Advisory Committee (MFAC). 5. Based on the recommendation of MFAC and analysis of public feedback, the following has been decided: A. Disclosure of Information Ratio 5.1.1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Benchmark used in the above formula shall be the Tier 1 benchmark currently used by the equity oriented Mutual Fund schemes. Volatility/Standard deviation shall be calculated on the basis of daily return values. Daily portfolio return shall be calculated using arithmetic function. C. Awareness amongst Investors: 5.1.5. In order to ensure better understandability about IR by investors, adequate st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th sufficient illustrations covering various scenarios. 5.1.8. In order to ensure uniformity in explanation of IR across the MF industry, AMCs shall provide a hyperlink in the aforesaid format on their websites, redirecting to the AMFI website providing detailed explanation of the IR. 6. The provisions of this circular shall come into force with effect within three months from issuance of this cir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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