While the bulk of midcap funds that have declared their results will be able to liquidate 25 percent of their portfolio within three days, only about half of the smallcap funds will be able to do the same.
Higher awareness
One positive outcome of the stress test is the increased awareness.
"It has raised awareness at least among some investors that liquidity can be a concern in the mid and smallcap segment during times of stress," says M Pattabiraman, associate professor, at IIT Madras and founder, Freefincal.com.
Alekh Yadav, head of investment products, Sanctum Wealth adds that having access to regular data on liquidity will make investors more conscious of this risk.
Methodology issues
Some experts have pointed to a couple of issues with the methodology employed to calculate the time for portfolio liquidation. One, funds are permitted to exclude the bottom 20 per cent of the least liquid stocks in their portfolios from calculations. This has the potential to skew results.
Diese Geschichte stammt aus der March 21, 2024-Ausgabe von Business Standard.
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Diese Geschichte stammt aus der March 21, 2024-Ausgabe von Business Standard.
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