Parag Parikh Flexicap Scheme (PPFAS), which had closed subscription after the overseas investment limit of the mutual fund industry got exhausted, will start accepting fresh inflows from the 15th of March. However, as the overseas investment curbs are yet to be open, all the incremental flows will be put only in domestic stocks.

In a note to unitholders, Rajeev Thakkar, CIO and Director of PPFAS Mutual Fund, said that over time the weightage of foreign stocks for the scheme would decrease. But as soon as overseas investment limits are increased, the scheme will rebalance the portfolio as per the prevailing situation and valuations. The fund will invest in a mix of international and local stocks. It decided to go for new subscriptions after the Securities and Exchange Board of India (SEBI) advised MFs to stop subscriptions in schemes planning to invest in overseas securities to avoid violation of industry-wide limits of $7 billion.

Investments in overseas Exchange Traded Funds (ETFs) can continue as the $1 billion limits are not fully used. Currently, MFs can make investments in overseas ETFs to a maximum of $300 million per MF and within the industry limit of $1 billion. “As of now, we have no visibility on when and how much the limit for overseas investments will be changed. As soon as the limits are increased, and it’s a minimal amount, the same will get exhausted soon. In this condition, having funds available will be helpful rather than opening the scheme after the limit increase only to see the industry-wide cap get violated again,” Thakkar said.