In September 2021, which of the following regulatory bodies decided to introduce a swing pricing mechanism for open-ended debt mutual fund schemes?

The correct answer is SEBI.

Key Points

• The Securities and Exchange Board of India (SEBI), on 29 September 2021, decided to introduce a swing pricing mechanism for open-ended debt mutual fund schemes.
• Swing pricing is a mechanism to apportion the costs of redemption and purchase requests of investors whose large orders cause a dent in the Net Asset Value (NAV).
• The new norms will come into effect from March 2022.

Important Points

• SEBI has directed the industry body Association of Mutual Funds in India (AMFI) to prescribe broad parameters for determining the thresholds for triggering swing pricing within three months.
• swing pricing will be applicable for a specified period in open-ended high risk and potentially high-risk debt schemes.

Additional Information

• About SEBI:
  • SEBI is a statutory regulatory body established on the 12th of April, 1988.
  • It monitors and regulates the Indian capital and securities market while ensuring to protect the interests of the investors, formulating regulations and guidelines.
  • The head office of SEBI is in Mumbai.