Role of Stakeholders In Debt Defaults

Losses in equities are digestible to investors but then comes losses in long duration debt funds, then short duration debt funds, then in liquid funds and now in FMPs also the loss have been extended and it is unacceptable by the investors. Out of two AMCs, (Kotak) one is redeeming the FMP; so called fund yield less expenses less the investments which are at present defaulted resulting to forget the yield, but erosion in capital. It is using the side pocketing and hopefully in September 2019 they will recover the investments to Essel group and payback to the investors with higher yields. The second AMC (HDFC) is giving the option to clients to roll over with new high yields or to redeem the funds at the current market value and forgo the right of recovery, if it happens and for which the AMCs are very positive for the recovery. In this case, if you are in need of funds, you have to bear the losses and there is no clarity for the future benefits for the same; may either be retained by AMC or the unit holders at that point of time .

This has not happened for the first…