Zee horror show: Mutual fund investors in 6 Kotak debt plans get a scare

6pack

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Sep 19, 2005
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Pitfalls of having such a huge exposure to any single group. I wonder why the fund managers didn't sell the shares months ago.
 

Lord Nemesis

Overlord
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Jun 3, 2005
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Its not exposure to equity that is the problem here, but to the debt itself in various debt schemes

Regardless of how much equity AMC procures, no single equity scheme will have high exposure to a single stock. Even in Focused equity funds, the exposure is to 50 or so stocks. For other schemes, the exposure is spread out much more.

AMC's also hold stock of the company as collateral for the debt, but since the stock has also taken a beating, they decided against selling it to recover the money.