SEO Encourages Indirect Investment
EghtesadOnline: Given the torrent of new investors in the bourse in a relatively short period, the regulator has stepped up efforts to make indirect investment in the market attractive for investors lacking financial literacy.
Meisam Fadaee, the Securities and Exchange Organization’s deputy for supervisory affairs, outlined some of the measures to convince neophyte investors to entrust their savings with asset managers and investment funds.
Diversifying investment funds, easing access via online trade platforms and cutting red tape and bureaucracy are among the measures.
“The Securities and Exchange Organization has eased cumbersome rules and doing all it can to improve the efficiency of investment funds,” Fadaee was quoted as saying by the SEO News Agency.
Asset managers are given more leeway to operate. “The number of permits given to asset management companies in the past seven months has increased 33% compared to the same period last year,” he said.
In addition, investment funds have expanded their portfolios by average 26% in the period. The value of assets held by mutual funds rose from 4,010 trillion rials ($14.8 billion) to 5,080 trillion rials (18.8 billion).
Besides encouraging newcomers toward indirect investment, fund managers have been incentivized to improve efficiency and the return on investment.
The SEO recently announced that it would cut investment fees for funds that have high returns. Accordingly, trading fees will henceforth vary and be performance oriented.
Investment fees have been cut from 2% to 1.5% and increase in proportion to the growth in the TSE and TEDPIX benchmarks.
Market experts have expressed concern about the unprecedented increase in the neophyte investors in recent months. Data released by the Central Securities Depository of Iran show the number of active trading codes reached 36.8 million by the end of the last calendar month on July 21.