NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Legal and Regulatory Framework
Under the SEBI (Mutual Funds) Regulations, which body is responsible for holding the assets of a mutual fund scheme in safe custody on behalf of unit holders?
The custodian, appointed by the trustees, keeps the securities of mutual fund schemes in safe custody for unit holders. The AMC only manages the investments, the RTA maintains unit records, and the sponsor merely sets up the fund, so none of them hold the assets.
- AThe Asset Management Company
- BThe Trustee company's appointed CustodianCorrect
- CThe Registrar and Transfer Agent
- DThe Sponsor of the mutual fund
Explanation
Scheme assets are held in trust for unit holders and the securities are kept in safe custody by a custodian appointed by the trustees. The AMC manages investments but does not hold the assets. The RTA only handles unit records and transactions, and the sponsor only establishes the fund.
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