Sebi exempts fund managers from placing orders for passive trades

A fund manager can now authorise an AMC employee to place an order on his behalf provided the order instructions are through the electronic mode, including email, and audit trail is maintained

The Securities and Exchange Board of India’s (Sebi’s) has exempted fund managers from placing orders for passive and arbitrage trades, in a partial relaxation to its diktat on trade allocation and execution that becomes applicable on January 1.

According to the regulator’s September circular, AMCs needed to use an automated Order Management System, by which orders on equity and equity-related instruments of each scheme are placed by the fund manager(s) of the respective schemes. Sebi has now said a fund manager may authorise an employee of the AMC for order placement on his behalf provided the order instructions are through the