EPFO is investing your money in risky assets
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EPFO invests its funds as per the investment pattern notified by the Finance Ministry. As per the current guidelines, the EPFO can invest 5-15 per cent of its annual incremental deposits in equity through ETFs, while the remaining amount can be invested in debt securities. There is no guideline on how to invest ETF redemption proceeds. According to the EPFO, till January 2023, the share of equity investment in its total corpus was only 10 per cent, while the permissible limit is 15 per cent.
how much is the limit
EPFO started investing in equities through ETFs in 2015-16. Then its limit was five percent. It was increased to 10 per cent in 2016-17 and then to 15 per cent in 2017-18. EPFO’s total investment in ETFs till March 31, 2022 was Rs 1,01,712.44 crore. This is 9.24 per cent of its total investment of Rs 11,00,953.66 crore. EPFO redeems its investments in ETFs from time to time. This amount is treated as income and so far only 15% of it is invested in ETFs while the rest is put in debt instruments.
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