Commentary
SECP issued circular # 8 of 2019, dated May 28, 2019 notified as amendments to the followings: –
1 – Clauses No. 1 and 9 of Circular No. 18 of 2015 dated May 15, 2015.
2 – Clause No. 1 of Circular No. 30 of 2017 dated November 24, 2017.
Amendments pertain to the requirements for Constant Proportion Portfolio Insurance (CPPI) based Collective Investment Schemes (CIS) by Asset Management Schemes (AMCs)
Amendment # 1 – An Asset Management Company (AMC) may use a maximum Multiplier of up-to 5 times to at exposure in risky assets including equity instruments without any cushion value percentage restriction, subject to the condition that exposure in risky assets including equity instruments shall not exceed 50% of the net assets of the Constant Proportion Portfolio Insurance based CIS/plan.
Amendment # 2 – The Requirement of submission of weekly report to the Commission regarding CPPI based CIS / Plan shall stand withdrawn.
The AMCs shall make necessary amendments in the offering documents of the concerned CPPI based CIS/plans prior to taking into effect the above – mentioned changes.
All other conditions of circular No. 18 of 2015 & Circular No. 30 of 2017 shall remain unchanged.
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