Now EPFO and PF Trust can invest in debt ETF. The government has issued a notification about this on Wednesday. So far, 4 tranches of Bharat Bond ETF have been launched.
new Delhi. The central government has allowed EPFO and Provident Fund Trust to invest in Bharat Bond ETFs such as Debt ETFs. A notification in this regard has also been issued by the government on Wednesday. So far 4 bonds of Bharat Bond have been launched. Two trunches were launched in December 2019 and the remaining two in mid-2020. The Edelweiss Asset Management company manages these ETFs. These ETFs are allowed to invest in AAA PSU debt and have expiry dates of 2023, 2025, 2030 and 2031.
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The total amount of these four ETFs is Rs 30,000 crore. Radhika Gupta, managing director and chief executive officer of Edelweiss Asset Management Limited, said, “We are expecting frollo monthly. Not at once. In this way it will be better to manage them and there will not be any problem of supply. ETFs have
lower returns than PF interest,
however, ETFs have given returns in the range of 4.5 per cent to 6.6 per cent. In FY 2020, EPFO declared 8.5 percent interest. Among these, the Exempted PF Trust also has to match. Experts say that the risk should be transferred to the subscribers.
Another expert aware of this said, “It is a good move but it would be better that EPFO and PF Trust should be credited to the accounts of the employees.” Only employees are allowed to take decisions in this regard. Without unitization, such a step will have an impact on the operation in limited form. Its impact on provident funds will also be seen less.
