Mu. Insider trading rules will be applied in fund dealing: SEBI

 

Capital Markets regulator SEBI has proposed to take serious action against those who misuse sensitive information pertaining to investment products in mutual fund units and impose insider trading rules. Currently, insider trading rules apply to the trading of listed companies. UPSI holds the undisclosed cost-sensitive information of listed and listed companies.

Mutual fund units are specially excluded from this definition of securities under the rules. The proposal was made after the Mutual Fund Registrar and Transfer Agent observed that all the units were redeemed from the scheme without the knowledge of the unit holder while maintaining confidentiality of certain sensitive information relating to the mutual fund scheme.

Some key employees of the mutual fund were found to have redeemed their holdings in the schemes, while possession of some sensitive information was not given to the unit holders of the scheme. Trading and proposed to amend the definition of insider trading and recommended that insider trading rules should be applied to dealing in units.

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