AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Karachi, October 24, 2012 (PPI-OT): Securities and Exchange Commission of Pakistan (SECP) has given permission to asset management companies (AMCs) to offer commodity schemes which is a type of Mutual Fund with commodities as the main investment avenue.
According to Alfalah Securities Limited, the investments in commodities by the fund will be made only be made through future contracts, which are traded on an organized exchange such as Pakistan Mercantile Exchange (PMEX) and having commodities as underlying assets.
The commodity funds are required to invest at least 70% of their assets in commodity future contracts, which include both cashsettled as well as deliverable contracts. Moreover, commodity schemes must maintain at least 10% of their net assets in cash and near cash instruments. It is a positive development for the mutual fund industry as it will increase the depth of the mutual fund market with the addition of new type of collective investment scheme.