Scheme Categorisation
SEBI's framework defining standard mutual fund categories with mandated investment characteristics.
How it is identified
Test: the scheme's holdings satisfy the allocation and eligibility rules prescribed for its declared category
Unit
qualitative
In depth
Introduced in 2017, categorisation forced fund houses to consolidate overlapping schemes and made a fund's name a reliable statement of what it holds — a large-cap fund must now hold at least 80% in the top hundred companies. This makes comparison across fund houses meaningful for the first time, since two funds in a category face the same constraints. Only one scheme per category is permitted per fund house, with limited exceptions. The trade-off is reduced manager flexibility, which is a real cost in exchange for a real gain in comparability.
Worked example
A large-cap fund must hold at least 80% in the top hundred companies by market capitalisation. Before 2017 a fund with the same name could have held half its assets in mid-caps and reported against a large-cap benchmark.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Scheme Categorisation” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.