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18 April 2018
 |
| EPF
(The Total Investment & Insurance Solutions) |
Over
five crore subscribers of retirement fund body EPFO will get an option to
increase or decrease investments of their provident fund into stocks through
exchange trade funds (ETF) in the current financial year.
The
Employees' Provident Fund Organisation plans to credit ETF investments in the
PF accounts of in about three months, thereafter it would give an option to the
subscribers to hike or cut investments in ETFs from their funds.
"We
have to develop a software to credit ETFs into the PF accounts of subscribers.
It will take 2 to 3 months," EPFO's Central Provident Fund Commissioner V
P Joy told.The Total Investment &
Insurance Solutions
"Once
we do that we would go for next phase to give an option to members to increase
or decrease investments in the stocks," he added.
EPFO's
apex decision making body, Central Board of Trustees (CBT), had last week
decided to explore the possibility of giving an option to subscribers for
enhancing equity allocation beyond mandated equity investment limit (presently
15%) as also of reducing it below that limit.
EPFO
invests 15 percent of its investible deposits into the ETFs. Earlier last year,
the CBT had approved an accounting policy to credit ETFs into the members
account apart from cash component.
The
CBT had also approved the recommendation of EPFO's advisory body -- Finance
Investment and Audit Committee (FIAC) -- that subscribers be allocated equity
units only for 15 percent of their contributions. All units over and above this
allocation to all the subscribers would be held by the EPFO.
EPFO
had started investing in ETFs in August 2015. In 2015-16 it invested 5 percent
of its investible deposits which was subsequently increased to 10 percent
2016-17 and 15 percent in 2017-18.
It
has invested Rs 41,967.51 crore in ETFs with return of 17.23 percent as on
February 28, 2018. The body had sold ETFs worth Rs 2,500 crore in March this
year for the first time to liquidate its investments in stock market.The Total Investment & Insurance
Solutions
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