Fund manager limits in mutual funds

SEBI’s fund manager limits framework caps the number of schemes a single fund manager can simultaneously manage. The framework ensures adequate attention per scheme and reduces the concentration risk of having one individual responsible for too many funds.

For Indian retail investors, the framework is rarely directly visible but matters because:

• A fund manager managing 10+ schemes has less time per scheme.
• Concentration of multiple schemes under one manager can reflect AMC organisational depth (or lack thereof).
• Manager-departure risk is elevated when one person runs many AMC schemes.

Framework

SEBI limits

Per SEBI guidelines:

• Single fund manager: typical limit of 3 to 6 actively managed schemes (varies by SEBI’s evolving guidance).
• Co-manager structures: A scheme may have multiple managers; one manager may co-manage several schemes alongside others.
• Index / passive funds: Higher tolerance; one manager may oversee multiple passive funds (since active discretion is limited).

AMFI guidance

AMFI provides additional best-practice guidance:

• AMCs should maintain “bench strength” with backup managers.
• Manager-departure protocols should be documented.
• Investor disclosure when manager changes occur.

Typical practice

Lead manager structure

• Each scheme has a designated lead manager.
• Some schemes have a co-manager (especially equity).
• Some AMCs designate “fund management team” rather than single individual.

Cross-scheme coverage

• A senior fund manager may manage:
  • 1 to 2 flagship schemes as lead.
  • Co-manage 2 to 3 other schemes.
  • Oversee a team running 5 to 10 schemes.

Multi-asset / hybrid schemes

• Often have one equity manager + one debt manager.
• Combined responsibility for asset allocation.

Exceptions

• Index / passive schemes: less restrictive.
• AMC’s house-fund-of-funds: typically managed by the AMC’s senior team.
• Inter-AMC overlap: A manager working at one AMC cannot manage schemes at another.

Investor implications

When researching a scheme:

• Check fund manager’s total scheme load on factsheet.
• High scheme count (more than 6) may indicate stretched attention.
• Compare with peer AMCs’ typical practice.
• Consider manager tenure (longer tenure usually indicates AMC commitment).

See also

• Mutual funds in India
• AMFI
• SEBI (Mutual Funds) Regulations 1996
• Trust structure (sponsor, trustee, AMC, custodian)
• AMFI standardised factsheet
• Revamped factsheet 2024
• SEBI half-yearly trustee report
• Compliance audit report (MF)
• Skin in the game (MF)
• NFO addendum
• SEBI

External references

• SEBI
• AMFI India

References

1. SEBI (Mutual Funds) Regulations 1996.
2. SEBI master circular on fund manager limits.
3. AMFI Best Practice Guidelines.