Cost is in favour of exchange traded funds: SEBI

The move, indicated by United Kingdom Sinha, chairman of the Securities and Exchange Board of India (Sebi) on Tuesday, aims to prevent crises such as the recent one in two fixed income schemes under JP Morgan AMC Ltd.

In a bid to check hoardings and bring down the prices of pulses, various state governments have conducted raids and had seized more than 75,000 tonnes of pulses.

(Left to Right) Chitra Ramkrishna, MD & CEO (NSE), U.K Sinha, Chairman (SEBI) and SB Mathur, Chairman (NSE) lighting the lamp at “India ETF Conference 2015”.

Sinha was speaking at “India ETF Conference 2015” conference organised by National Stock Exchange (NSE) here On Monday, the NSE said in a statement issued here. We are working on ways to ensure that credit rating agencies are doing fair and timely disclosures on their rating rationale to protect the investors.

The Sebi chairman also said that to speculate that commodity futures may lead to a rise in price of pulses “is wrong”. There is also global shortage of lentils.

According to data maintained by the consumer affairs ministry, retail tur prices are still as high as up to Rs 205/kg, urad at Rs 198/kg, moong dal at Rs 130/kg, masoor dal at Rs 110/kg and gram (chana) at Rs 85/kg.

Sebi chief noted that ETFs as financial innovations have emerged important and widely accepted financial instrument, but cautioned that regulators should careful about all financial innovations, else they could pose as threats to the market and in extreme cases even to the economy as a whole.

“Based on inputs from cross section of experts or participants if there is any need that further changes are required for rules and regulations of the ETFs, Sebi will be more than willing to listen to you and incorporate them”. “There is a very good chance of the product being popular among the masses if we are able to communicate properly”, he added. “We have held meetings with credit rating agencies and debenture trustees and a few additional guidelines for these entities will be announced by Sebi in the next couple of months”, Sinha said. This will take a few months. “Once that is over, allowing new products and players would start happening”, Sinha said while reiterating that the regulator would go for product development and business development once the system was tested. An ETF is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund.