Axis Mutual Fund has removed its head trader and fund manager Viresh Joshi and its equity research analyst and fund manager Deepak Agrawal from the fund management team on allegations of front running, according to an ET report quoting sources. Joshi has been removed from the fund management team of its seven equity schemes, while Agrawal from three funds.
The seven funds are: Axis Consumption ETF, Axis Banking ETF, Axis NIFTY ETF, Axis Arbitrage Fund, Axis Quant Fund, Axis Technology ETF and Axis Value Fund.
Front-running is trading stock or any other financial asset by a broker who has inside knowledge of a future transaction that is about to affect its price substantially. A broker may also front-run based on insider knowledge that their firm is about to issue a buy or sell recommendation to clients that will almost certainly affect the price of an asset, according to Investopedia. The practice is illegal in India.
“Axis AMC has been conducting a suo moto investigation over the last two months (since February 2022). The AMC has used reputed external advisors to aid the investigation. As part of the process, two fund managers have been suspended pending investigation of potential irregularities. We take compliance with applicable legal/regulatory requirements seriously, and have zero tolerance towards any instance of non-compliance,” according to the ET report quoting Axis Mutual Fund.
The report also quoted Vishal Dhawan, founder of Plan Ahead Investment Managers, saying that at the moment, mutual fund investors should not make any changes to the schemes.
“All the funds that have seen the change are managed by multiple managers and hence I don’t see a reason to panic right now. Investors should not make any changes to their portfolio till the rumours are confirmed and there is a statement from the fund house. Even after that, if at all it changes anything for your particular scheme has to be seen,” Dhawan was quoted as saying.
Earlier, Sachin Jain, Viresh Joshi and Devang Shah were fund managers of Axis Arbitrage Fund. Now, the new team includes Ashish Naik, Sachin Jain and Devand Shah.
Axis Banking ETF had Viresh Joshi and Ashish Naik was fund managers, while now Viresh Joshi has been dropped and Ashish Naik is the only fund manager for now.
Axis Consumption ETF’s managers were Viresh Joshi and Deepak Agarwal. Now, Ashish Naik is there. Axis Nifty ETF had Ashish Naik and Viresh Joshi in the team. Now, Ashish Naik is there.
Axis Quant Fund had Deepak Agarwal but now, Ashish Naik. In the Axis Technology ETF scheme, Jinesh Gopani and Viresh Joshi were there in the team. Now, Jinesh Gopani is there.
From the team of the Axis Value Fund scheme, Deepak Agarwal has been removed. Now, Jinesh Gopani is there.
