Revised Unit Trust Guidelines

April 2008

The Securities Commission (SC), in a move to expand Malaysia's unit trust sector, has revised its guidelines, effective 3 March, to allow unit trust funds to increase their exposure in derivatives, and scrapped the requirement to seek the SC's approval to invest in foreign markets, subject to the said markets fulfiling certain criteria such as their home regulator being a member of the International Organisation of Securities Commissions (IOSCO). Other key changes include lifting cash borrowing restrictions to meet redemption requests, mitigating the need to dispose of assets in a fund's investment portfolio, which could affect the interest of the remaining unit holders.