Quick answer: IFSCA's Consultation Paper on Offering 'Model Portfolio' by Research Entities, dated 9 November 2026, proposes that GIFT IFSC research entities may offer model portfolios — baskets of securities with defined weightages, themes and benchmarks — under the CMI Regulations, 2025. Any entity, including a broker dealer, must first register as a Research Entity; comments are due by 30 November 2026.
The International Financial Services Centres Authority (IFSCA) has issued the Consultation Paper on Offering 'Model Portfolio' by Research Entities in the International Financial Services Centre on 9 November 2026, proposing that research entities operating in GIFT IFSC be allowed to offer model portfolios — curated baskets of securities built around a defined investment theme or strategy — and setting out the safeguards they would have to follow. The paper carries a draft circular as Annexure-I and invites public comments by 30 November 2026. Nothing in the proposal is final yet: the draft circular is expressly marked as a draft, and the framework will take shape only after IFSCA considers the comments it receives.
For a research business in GIFT City, this is a meaningful opening. Until now, a research entity's output has been the research report on a specific security — a buy, sell or hold recommendation, a price target. A model portfolio is a different product: a whole basket, with weights, a theme, a benchmark and a rebalancing schedule. IFSCA's paper says market participants have been asking for exactly that, and that the current regulations do not explicitly provide for it. The consultation paper proposes to close that gap by clarifying that a research recommendation includes offering a model portfolio.
⚠️ Read this first — it is a proposal, not a rule. The draft circular in Annexure-I is marked "DRAFT CIRCULAR" and carries placeholder references (e.F.No. XXXX, December XX, 2026). No research entity can offer a model portfolio under this framework today. The final circular, if issued, will state when it comes into force. Do not advise a client that model portfolios are already permitted in the IFSC.
What IFSCA is proposing
The consultation paper's objective, in its own words, is to seek comments on the draft circular "for providing clarification that Research Entities may offer model portfolios and the guidelines to be followed by them while offering Model Portfolio". The proposal rests on the IFSCA (Capital Market Intermediaries) Regulations, 2025 — the CMI Regulations — which already provide the regulatory framework for research entities in the IFSC. What the CMI Regulations do not do today, the paper says, is explicitly provide for research entities to offer model portfolios. The fix proposed is a clarification, not a new registration regime: providing a research recommendation would expressly include offering a model portfolio.
The paper gives three reasons the clarification is needed. First, with the growth of the IFSC as a global financial hub, there is increasing demand for sophisticated research products beyond individual security analysis. Second, market participants have expressed a need to offer model portfolios as curated baskets of securities with specific weightages based on defined investment themes or strategies. Third, given that the IFSC is a jurisdiction for international financial services, these model portfolios are "largely expected to be global in nature, often focusing on global markets and utilizing multi-asset strategies including equities, fixed income ETFs, commodity ETFs, etc."
The paper also draws a clear registration line. "Accordingly, any entity, including a Broker Dealer, shall be required to seek registration as a Research Entity in order to offer a Model Portfolio." A broker dealer that wants to publish model portfolios cannot do so under its broker-dealer registration alone — it must first register as a research entity.
What counts as a model portfolio — and what does not
The draft circular's definition is the heart of the proposal, and it turns on one word: weightages.
"Model Portfolio" shall mean a basket of securities for which a research report is issued by a research entity recommending the relevant weightages for one or more securities mentioned therein.
Explanation: if the research report does not ascribe weightages to the components of the basket, then merely a summary or consolidated presentation of securities recommended shall not be regarded as a 'model portfolio'.
That explanation matters. A report that lists ten recommended stocks without saying how much of each to hold is not a model portfolio under this definition — it is a summary of recommendations. The weightages are what turn a list into a portfolio, because they are what a reader would actually implement. The draft circular also defines three supporting terms:
- Disclosures — the set of disclosures specified in the circular that must mandatorily be included in a model portfolio, so that all relevant facts are disclosed.
- Launch Date — the date on which the model portfolio is first offered through a research report.
- Update Date — the date on which the model portfolio is revised or updated following a change in the composition of securities or their weightages.
Old position vs proposed position
The nine obligations for research entities offering model portfolios
The draft circular's paragraph 5.2 sets out the obligations that would apply in addition to the CMI Regulations and the Master Circular for Research Entities dated 5 August 2025. Each is a condition of offering a model portfolio, not a suggestion:
1. Model Portfolio Report (5.2.1)
A model portfolio may be offered only through a formal research report. The opinion on any constituent security must not be contrary to the research entity's individual research opinion on that security — a portfolio cannot quietly contradict the entity's own published view on a stock it contains. Each model portfolio report must contain a comprehensive "factsheet" setting out the basic information, rationale and underlying methodology.
2. Methodology (5.2.2)
The report must define the framework for selection of securities and indicate three things: (a) the geographical universe — such as US Markets, European Markets, Emerging Markets, or any other markets, so investors understand jurisdictional and market risks; (b) the asset class or classification — equities, fixed income ETFs, commodity ETFs, and so on; and (c) the underlying theme, if applicable — the draft circular names examples such as Tech Momentum, Space Tech, Artificial Intelligence, Fintech Innovation, and Sustainable Finance.
3. Parameters (5.2.3)
Selection parameters — such as fundamental analysis, technical analysis, or quantitative factor-based modelling — must be discussed in detail in the research report. A theme label alone is not enough; the reader must be able to see how securities were picked.
4. Labelling (5.2.4)
Model portfolios must be "true to label": the nomenclature must clearly state the portfolio type and a description of the investment objective. A portfolio called "AI" must actually be an AI portfolio.
5. Investment horizon (5.2.5)
Every model portfolio report must specify the recommended investment horizon, so investors can align the strategy with their own investment period.
6. Frequency of update (5.2.6)
Whether the model portfolio would be updated, and at what intervals, must be predefined in the research report. Rebalancing, if any, must generally be done within the overall framework of the model portfolio and communicated to clients. For rebalancing other than at pre-defined intervals, the rationale must be communicated to clients.
7. Risk disclosure (5.2.7)
The research report must include appropriate risk disclosures, including risk factors specific to the securities in the model portfolio. It must also carry a disclaimer that a model portfolio is a research recommendation and not investment advice or a scheme, and that the research entity does not manage any portfolio on behalf of any investor. That disclaimer is the boundary between research and portfolio management — a model portfolio tells a reader what the research says; it does not run their money.
8. Benchmarking (5.2.8)
The research entity must clearly identify a benchmark index for each model portfolio and compare its performance with the benchmark index in the research reports and in communications with clients. Performance claims must be consistent and comparable against relevant, predefined indices — the consultation paper lists this as one of its major safeguards.
9. Audit requirement (5.2.9)
The research entity must have a system to monitor that the model portfolios are in compliance with the circular, and a periodic internal audit of the model portfolios offered must be carried out in accordance with regulation 31 of the CMI Regulations.
Why this matters in plain language
For a business owner or investor reading this from outside GIFT City, the practical meaning is simple: IFSCA wants research firms in the IFSC to be able to sell a ready-made, themed basket of global securities — say, an AI basket or an emerging-markets basket — with the weights spelled out, instead of only publishing one-stock-at-a-time research. The guardrails are designed so the buyer can check what they are getting: the basket's theme must match its contents, its benchmark must be named, its performance must be shown against that benchmark, and any change to its contents must be explained. And the line is drawn clearly: this is research, not advice and not fund management — the research entity does not handle the investor's money.
For research entities and broker dealers already in the IFSC, the immediate consequence is a registration question, not a product launch. A broker dealer that wants to offer model portfolios must first register as a research entity. Firms should also note that the framework is global and multi-asset by design — the paper expects these portfolios to focus on global markets and to span equities, fixed income ETFs and commodity ETFs — so the compliance build-out (factsheets, benchmarking, internal audit) needs to cover cross-border securities, not only Indian ones.
Who is affected
- Research entities in the IFSC — the direct audience. They gain a new product line, subject to the nine obligations above.
- Broker dealers in the IFSC — they must register as research entities before they can offer a model portfolio.
- Capital market intermediaries and market infrastructure institutions in the IFSC — both are addressees of the draft circular, and MIIs will see new research products referencing their markets.
- Investors who follow IFSC research — they would get weighted, benchmarked, theme-based baskets with disclosed rebalancing, instead of single-security recommendations only.
- Compliance and audit teams — the factsheet, benchmarking and regulation 31 internal-audit requirements create new ongoing work.
What to do next
If you are a research entity, broker dealer or other stakeholder in the IFSC, the window to shape this framework is open now — and it is short.
- Read the consultation paper and the draft circular (Annexure-I) from IFSCA's website before forming a view — the obligations above are a summary, not a substitute.
- Decide whether to comment. Comments are invited on the draft circular, not only on the concept — clause-wise suggestions carry more weight than general support or opposition.
- Use the paper's format. Comments may be provided in the format given in the paper — MS Word or MS Excel only — with your name and designation, contact number and email address, organisation name, and, for each clause, the serial number, clause number, text of the clause, comments or suggested modifications, and detailed rationale.
- Send comments by 30 November 2026 by email to Shri Akash Boddeda, Manager, IFSCA ([email protected]) and Shri Rishikesh Wandhekar, Assistant Manager, IFSCA ([email protected]), with a copy to Shri Pawan Kumar Chowdhary, DGM, IFSCA ([email protected]) and Shri Arjun Prasad, CGM, IFSCA ([email protected]). Use the subject line: "Comments on draft circular - Offering Model portfolio by Research Entities in the IFSC".
- Do not launch a model portfolio yet. The draft circular is not in force. Any offering before a final circular would have no basis under this framework.
- If you are a broker dealer, start the research-entity registration assessment now, so the option is open when the final circular lands.
What is NOT covered: the paper does not change anything for research analysts or research entities outside the IFSC — SEBI's onshore research framework is untouched. It also does not authorise portfolio management services or investment advisory services; a model portfolio remains a research recommendation. And it does not say when a final circular will issue — the draft carries a placeholder date of December XX, 2026, which is part of the draft, not a commitment.
Related IFSCA coverage
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- IFSCA Issues Final Good Delivery Guidelines, 2026 — the 5-step responsible-sourcing code for gold refiners on the IFSC Bullion Exchange.
- IFSCA Technical Working Group on Credit Information Companies in GIFT IFSC
Frequently asked questions
What is IFSCA's model portfolio consultation paper of 9 November 2026?
It is the Consultation Paper on Offering 'Model Portfolio' by Research Entities in the International Financial Services Centre, dated 9 November 2026. It proposes clarifying that a research recommendation under the IFSCA (Capital Market Intermediaries) Regulations, 2025 includes offering a model portfolio, and it carries a draft circular with the proposed conditions.
What is a model portfolio under the draft circular?
A basket of securities for which a research report is issued recommending the relevant weightages for one or more securities in the basket. If the report does not ascribe weightages, a mere summary or consolidated presentation of recommended securities is not a model portfolio.
Can a broker dealer in GIFT IFSC offer model portfolios?
Only after registering as a Research Entity. The consultation paper states that any entity, including a broker dealer, must seek registration as a research entity in order to offer a model portfolio.
Is a model portfolio investment advice?
No. The draft circular requires a disclaimer that a model portfolio is a research recommendation and not investment advice or a scheme, and that the research entity does not manage any portfolio on behalf of any investor.
What must a model portfolio report contain?
A comprehensive factsheet with basic information, rationale and methodology; the geographical universe, asset-class label and theme; selection parameters; the investment horizon; the update frequency; risk disclosures and the disclaimer; and a named benchmark index with performance compared against it.
How often can a model portfolio be rebalanced?
Rebalancing must generally happen at pre-defined intervals set out in the research report. If a portfolio is rebalanced at other times, the rationale must be disclosed to clients.
When is the last date to comment on the IFSCA model portfolio draft circular?
30 November 2026. Comments go by email to Akash Boddeda ([email protected]) and Rishikesh Wandhekar ([email protected]), with a copy to Pawan Kumar Chowdhary ([email protected]) and Arjun Prasad ([email protected]), with the subject line "Comments on draft circular - Offering Model portfolio by Research Entities in the IFSC".
Is the model portfolio framework in force now?
No. The circular in Annexure-I is a draft marked "DRAFT CIRCULAR" with placeholder references. It will come into force only if and when IFSCA issues a final circular after considering comments.
Sources
- IFSCA — Consultation Paper on Offering 'Model Portfolio' by Research Entities in the IFSC (official PDF, 9 November 2026): ifsca.gov.in
- IFSCA — Public Consultation listing (homepage): ifsca.gov.in
- Business Standard, 9 November 2026 — IFSCA proposes model portfolios in GIFT City by research entities: business-standard.com
This article is based on the official IFSCA consultation paper dated 9 November 2026. The draft circular it carries is a proposal open for comment until 30 November 2026 and is not yet in force. Verify the final position from IFSCA's website before acting.
