In India the structure of mutual fund is three tiers:
SPONSOR→TRUSTEE→AMC
SPONSOR:
A sponsor is the promoter of the fund. He establishes the trustee and AMC and appoints the boards of both these but with the approval of SEBI. At least 50% of the directors in an AMC should be independent directors of the sponsor. The sponsor should have a 5 year track record in financial service business and should earn profits in 3 years out of those 5 years. At least the sponsor should contribute 40% of the capital in AMC. Asset Management Company shall not deal with any broker/firm associated with sponsor beyond 5% of daily gross business of the mutual fund.
SPONSOR→TRUSTEE→AMC
SPONSOR:
A sponsor is the promoter of the fund. He establishes the trustee and AMC and appoints the boards of both these but with the approval of SEBI. At least 50% of the directors in an AMC should be independent directors of the sponsor. The sponsor should have a 5 year track record in financial service business and should earn profits in 3 years out of those 5 years. At least the sponsor should contribute 40% of the capital in AMC. Asset Management Company shall not deal with any broker/firm associated with sponsor beyond 5% of daily gross business of the mutual fund.
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