Neutral impactEconomy
SEBI proposes foreign investments, unhedged short positions for portfolio managers
BusinessLine 1 hr ago·24 Jul 2026, 11:51 am
The Securities and Exchange Board of India (SEBI) has released draft regulations that would significantly broaden the scope for portfolio managers. The proposed changes would allow these professionals to make unhedged short positions and invest in foreign markets, which are currently restricted. Additionally, the framework is set to introduce a dedicated mutual fund structure for Portfolio Management Services (PMS), aiming to make these services more accessible to retail investors.
This move is important because it modernizes the regulatory framework to match global standards. By permitting unhedged short positions and foreign exposure, portfolio managers can now execute more complex and diversified investment strategies. This could potentially enhance returns for investors while also increasing the risk profile of these funds.
Investors should watch for the finalization of these rules and the specific guidelines on the new mutual fund-only PMS framework. Understanding the risk-return profile of these new offerings will be crucial for retail investors looking to diversify their portfolios through alternative investment avenues.
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- Category: Economy.
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