The Securities and Exchange Board of India has raised the limit for overseas investment by each mutual fund house to USD1 bln from USD600 mn, while maintaining the overall cap for the mutual fund industry at USD7 bn, as per a circular.

 It also hiked the limit of investments in overseas exchange-traded funds by each fund house to USD300 mln from USD200 mln. This would be within the cap of USD1 bln for the mutual fund industry's investment in overseas ETFs.

The revised limits are based on the representations received from the mutual fund industry, and it will be applicable with immediate effect, SEBI said. On Nov 5, the securities' regulator had doubled the investment limit in foreign securities from USD300 mln, and also said that USD50 mln will be reserved for each mutual fund to make individual overseas investments.

Market participants say that consistent outperformance has attracted many savvy Indian investors towards global equities, and investors have also showed strong participation for such products during the new fund offers.

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