Investment limits on special-feature debt restrict mutual fund exposures and require segregation and adjusted valuation after triggers. Limits are prescribed for mutual fund investments in debt instruments with special features such as loss-absorbing subordination or conversion triggers; excess holdings as of the circular date are grandfathered but no fresh investments are permitted until within limits. Schemes must provide for creation of segregated portfolios and may transfer affected instruments on a trigger event, with valuation reflecting issuer stress from the trigger date. Perpetual bonds shall be valued with a notional maturity of one hundred years and close-ended debt schemes are barred from investing in perpetual bonds.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Investment limits on special-feature debt restrict mutual fund exposures and require segregation and adjusted valuation after triggers.
Limits are prescribed for mutual fund investments in debt instruments with special features such as loss-absorbing subordination or conversion triggers; excess holdings as of the circular date are grandfathered but no fresh investments are permitted until within limits. Schemes must provide for creation of segregated portfolios and may transfer affected instruments on a trigger event, with valuation reflecting issuer stress from the trigger date. Perpetual bonds shall be valued with a notional maturity of one hundred years and close-ended debt schemes are barred from investing in perpetual bonds.
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