SEBI has issued new guidelines for assigning risk to mutual fund schemes investing in the commodity markets.
The risk score of a commodity on the risk-o-meter will depend on the annualised price volatility, which will be computed quarterly, based on the past 15-year prices of the benchmark index of the particular commodity.
For instance, if gold has an annualised price volatility of 18 per cent based on its price over the last 15 years, then gold and gold-related instruments will have a high risk value of 5 on the risk-o-meter, it said.
The circular will come into force with immediate effect, it added.
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