Many international ETFs are trading at a premium compared to their indicative intraday value (I - NAV) after the market regulator Sebi asked mutual funds to stop fresh subscriptions in their overseas ETFs from April 1.

Mirae Asset Mutual Fund recently issued an advisory that “Our international ETFs are trading at a significant premium since market makers are not allowed to create new units to cater to the demand due to restrictions on subscription of international funds for the mutual fund industry by Sebi.”

Zerodha also tweeted and informed the investors that “Several ETFs investing in international securities are trading at a premium compared to their Indicative Net Asset Value (iNAV). This is because of restrictions on international investments due to these ETFs hitting overseas investment limits.”

As per the market regulator, the overall investment limit of $1 billion is about to be breached. Sebi asked mutual funds to value utilisation of overseas investment limits at the cost of acquisition and not as per current market prices.