The securities regulator has moved to launch a web portal that will display the performance of all open-ended mutual funds (MFs) to help investors make investment decisions.
In a telephonic conversation with the FE, the chairman of the Bangladesh Securities and Exchange Commission (BSEC), Masud Khan, said the Dhaka Stock Exchange (DSE) would launch the web portal.
Usually, asset management companies post results of their funds' performance on their respective platforms. So, investors have to go to separate platforms to gather information about separate fund's performance. Hence, comparing one fund's performance with another becomes cumbersome.
"A retail investor needs to understand which mutual fund is performing well and which is not," said Mr Khan.
In other countries including India, there are several common, centralised portals that aggregate and display financial data tied to mutual funds operating globally, which allow investors to compare returns, fees, and risks across multiple countries.
Their visual trackers also map each fund's historical Net Asset Value (NAV) against the benchmark index.
"To help investors understand better, we will design several international-standard KPIs (Key Performance Indicators) to measure the performance of the funds," said the BSEC chief.
A simple example of a KPI is how much NAV of a pooled fund increased in a year.
Internationally, those who monitor mutual fund performance post fund metrics regularly in one place. Currently, the performance of locally managed funds is being posted on a weekly basis in a scattered manner by the respective fund managers.
"We want everyone to report to one central location so that investors can compare mutual fund performance," Mr Khan said, without specifying any timeframe for the launch of the portal.
He, however, said, "I think the DSE has already taken an initiative and I will look into it."
Presently, the number of open-ended mutual funds is 94, and the assets under their management are equivalent to Tk 51.8 billion as of March this year.
Investors, especially retailers, are expected to prefer mutual funds managed by professional asset managers to self-picking equities for investments. But in Bangladesh investors have lost faith in professionally-managed funds after several incidents of fund embezzlement and scams.
The incumbent commission of the securities regulator has focused on the development of the mutual fund industry.
In a recent interview with the FE, the BSEC chairman said the country's capital market is retail-centric and so mutual funds would be crucial tools to benefit retailers.
On the wrongdoings by some errant fund managers, Mr Khan said, "All know that some big fund management companies committed irregularities, and investors suffered for that.
"We will give them no more space."
Among the scams committed by fund managers, top executives of Universal Financial Solutions (UFS), including its former managing director Sayed Hamza Alamgir, fled the country, siphoning off Tk 2.07 billion from four financial instruments. The scam-hit funds are UFS Popular Life Unit Fund, UFS-IBBL Shariah Unit Fund, UFS-Bank Asia Unit Fund, and UFS-Padma Life Islamic Unit Fund.
Even after intervention by the High Court and the Anti-Corruption Commission (ACC), not a single penny could be recovered from the fund manager.
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