International mutual funds schemes begin accepting fresh investments


Several mutual fund houses have started allowing investments in their international fund schemes which were previously closed.

For the uninformed, SEBI had directed fund houses to stop accepting fresh investments into schemes investing in foreign companies at the beginning of the year.

Now some fund houses are allowing investments only via systematic routes,that is SIP & STP whereas some are also allowing via lumpsum.

Certain fund houses are allowing new investors while some have reopened investments only for current investors.

The rules vary from fund house to fund house so it is better to check prior to investing.

best mutual funds

Why was the restriction imposed?

SEBI had directed fund houses to stop accepting fresh investments into schemes investing in foreign companies.

This direction was warranted since the mutual fund industry had surpassed the limit of $ 7 billion for overseas investments.

This was applicable for all fund houses with schemes investing in foreign companies.

Therefore fund houses had been conveying to their investors about the same which was applicable on sip, lumpsum and stp transactions.

It had no bearing on past investments nor sip registered previously.


Additional reading: Click Here to read  whether you are an Investor or a Trader

Why the partial reopening of International mutual funds?

To put it simply, international mutual fund have been struggling with negative returns for several quarters now.

This meant the AUM of most international funds had taken a beating due to negative returns.

Another factor that contributed to reduction in AUM was the global selloff.

Both these factors created scope for additional investments.


Kindly note that not all fund houses have re-opened their international schemes, only the likes of Mirae, Nippon and Edelweiss have re-opened for the time being.

Are you investing in the right mutual funds?

Why are International Funds struggling?


Post the 2008 financial crisis, central banks across the globe have kept interest rates on the lower side to encourage growth.

A very obvious side-effect of this approach is the rise in inflation since easy liquidity fuels inflation.

Coupled with the Ukraine-Russia conflict and the continued lockdown in China disrupting the global supply, rising rates have added to inflation.

In March 2022, the US for example had its highest inflation rate for around 40 years.

To counter the rising inflation, in May 2022, the Reserve Bank of India hiked the Repo rates by 40 basis points to 4.40%.


How inflations impacts Equities

High inflation brings along with it higher interest rates in order to tackle high inflation.

Higher interest rates means higher input costs for businesses.

These higher costs are then passed on to the end customer.

All of this leads to higher prices for the end customer.

Demand therefore takes a hit which in turn leads to slower economic growth.

Lower economic growth would mean pressure on earnings growth of companies which therefore means moderate growth for the companies.


Additional reading: Click Here to read Why you need a financial plan

Ukraine- Russia Conflict & The China lockdown

Just as most of the world was coming back to terms to some sort of normalcy, the Ukraine- Russia conflict has thrown a spanner in the works.

China continues to struggle with containing corona virus and therefore stricter lockdowns still prevail.

Both these situations have disrupted the global supply chain.

Crude oil has touched new highs while there are fears of an impending food scarcity.

The Ukraine-Russia conflict has completed 100 days and there are no signs of a ceasefire yet while the stricter lockdowns in China too show no signs of receding.

Equity markets do not take a liking for uncertainty.




1 yr Return

Invesco Ind – Invesco Global Consumer Trends FoF

-42.62 %

PGIM Ind – Emerging Markets

-41.58 %

PGIM Ind - Global Opportunities

-37.32 %

Kotak Global Innovation FOF

-35.95 %

Edelweiss US Tech Equity FOF

-33.89 %


Are you investing in the right mutual funds?

What changed after 2020?

During the market crash of 2020 due to the corona outbreak, the Indian stock market was one of the worst affected.

After a couple of months when recovery in terms of market returns picked up, developed markets initially paced much ahead of the developing economies.

This is when diversification as a concept gained more prominence.

This meant investors were now ready to look beyond domestic markets for their investments and mutual fund houses which had hardly launched any international fund schemes were now changing their stance.

Being able to invest in global tech giants like Facebook, Apple, Amazon, Netflix and Alphabet (Google) was another motivating factor.



For portfolio enquiriesemail us with your doubts at

Disclaimer : While due precaution has been undertaken in the preparation of this article, The Mutual Fund Guide or any of its authors will not be held liable for any investments based on the above article. The above article should not be considered financial advice and has been published only for your perusal. Due credit has been given in case wherever required, in case you feel any part violates any rights then do get in touch with us and we shall get it duly removed.  
Mutual Fund investments are subject to market risks. Please read the offer document carefully before investing

Copyright © 2022  The Mutual Fund Guide, All rights reserved  

My Instagram