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EPFO to invest Rs 22,500 cr in ETFs for FY18

The annualised return on EPFO investments in ETFs has been over 12% so far: CPF Commissioner V P Joy

Press Trust of India  |  New Delhi 


Retirement fund body will park about Rs 22,500 crore in the exchange traded funds this fiscal following the approval of its trustees to enhance investments in equity or equity linked schemes last month, a senior official has said. Last month, the Employees Provident Fund Organisation's (EPFO) apex decision making body had approved the proposal to increase the investments in exchange traded funds from 10 per cent to 15 per cent of the investible deposits. "The had invested Rs 1.5 lakh crore 2016-17. The investible deposits are also estimated at Rs 1.5 lakh crore during the current fiscal.

Thus the investments in in 2016-17 would be about Rs 22,500 crore," EPFO's Commissioner V P Joy told PTI. Joy further said, "The has invested Rs 23,000 crore in ETFs so far. The annualised return on these investments has been over 12 per cent so far." The has an investment mix of government securities, state loans, corporate bonds and others like (SDS). The EPFO, however, gets returns even lower than 8 per cent on some of its investments particularly government bonds and schemes. The had entered the stock market by investing 5 per cent in the ETFs in August 2015, which was raised to 10 per cent last year. In 2015, the finance ministry had allowed private provident funds to invest 5-15 per cent of its investible deposits in equity or equity-linked schemes. In view of the volatile nature of stock markets, the had then decided to start with investing just 5 per cent of its over Rs 1 lakh crore investible amount in ETFs. The retirement fund body has over four crore contributing subscribers and has provided 8.65 per cent rate of interest on PF deposits for 2016-17, a tad lower than 8.8 per cent for 2015-16.

First Published: Sun, June 11 2017. 11:26 IST