New 55% Off on All Courses - Enroll Now! Click Here

    Question

    What is the minimum holding period requirement SEBI has

    proposed for the underlying assets of securitized debt instruments (SDIs), and what purpose does this serve?
    A 6 months, to allow early redemption options Correct Answer Incorrect Answer
    B 12 months, to increase investor turnover Correct Answer Incorrect Answer
    C 24 months, to establish a stable track record of asset performance Correct Answer Incorrect Answer
    D 18 months, to align with market trends Correct Answer Incorrect Answer
    E No minimum period, allowing greater flexibility for issuers Correct Answer Incorrect Answer

    Solution

    SEBI's proposal includes a minimum holding period to ensure that the underlying assets of SDIs have a stable performance record before securitisation, aligning interests between originators and investors and enhancing market stability.

    Practice Next