Parag Parikh Flexi Cap Fund no longer accepts new transactions. Where should you invest?
PPFAS Mutual Fund recently issued a notice and amendment stating that the Parag Parikh Flexi Cap Fund will temporarily cease accepting new transactions. So, where should one invest? Continue reading to learn more.
The Securities and Exchange Board of India (SEBI) has directed mutual funds that invest in foreign equities to halt further investments in order to avoid exceeding the industry-wide overseas limit. According to a circular issued by the SEBI on June 3, 2021, mutual funds can make foreign investments of up to one billion US dollars per mutual fund. However, the entire industry ceiling has been set at USD 7 billion.
PPFAS Asset Management Private Limited has decided to temporarily cease transactions in the Parag Parikh Flexi Cap Fund beginning February 2, 2022. As a result, any transactions received in this fund after the cut-off date of February 1, 2022, will not be accepted or processed. As of December 2021, over 29 per cent of the portfolio of the Parag Parikh Flexi Cap Fund was invested in foreign securities.
The table below will assist you in understanding the impact of this decision on transactions in the Parag Parikh Flexi Cap Fund.
|
Sr.
No.
|
Particulars
|
Impact
|
|
1
|
Lumpsum subscription
|
Shall not be accepted effective February 2, 2022
|
|
2
|
Fresh Systematic Registration (including systematic transfer plan into the Parag Parikh Flexi-Cap Fund)
|
Shall not be accepted effective February 2, 2022
|
|
3
|
Instalments of Systematic Investment / Transfer Plans existing as on February 1, 2022
|
Existing SIPs / STPs instalments will continue
|
|
4
|
Switch-out or instalments of Systematic Transfer Plan existing as on February 1, 2022
|
No trigger of any switch-out transactions or systematic transfer out instalments effective February 2, 2022. However, units may be allotted where the switch out transaction or the systematic transfer out leg was
processed prior to February 2, 2022
|
|
5
|
Investments to be made by designated employees in line with SEBI circular dated April 28, 2021 and September 20, 2021 (on alignment of interest of designated employees of the asset management companies with unitholders of mutual fund schemes)
|
Effective February 2, 2022, investments shall be made in units of those schemes whose risk value as per the risk-o-meter is equivalent or higher than the designated schemes.
|
|
6
|
Intra-Scheme (Regular to Direct and vice versa) switches
|
No impact
|
|
7
|
Switch-out, redemptions, registration of fresh systematic withdrawal plan, and instalments of existing systematic withdrawal plan (where the Parag Parikh Flexi-Cap Fund is the source scheme)
|
No impact
|
Many investors may now be thinking which flexi-cap fund they might consider investing in after February 2, 2022. Don't be concerned! Other than the Parag Parikh Flexi Cap Fund, below is a list of the top five flexi-cap funds.
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Trailing Returns (%)
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
|
SBI Flexicap Fund
|
27.60
|
18.77
|
14.54
|
17.20
|
|
DSP Flexi Cap Fund
|
25.33
|
23.35
|
18.40
|
16.86
|
|
UTI Flexi Cap Fund
|
27.07
|
18.43
|
13.44
|
17.25
|
|
Aditya Birla SL Flexi Cap Fund
|
26.88
|
22.78
|
15.93
|
15.53
|
|
Kotak Flexicap Fund
|
23.53
|
17.24
|
14.16
|
16.95
|