EPFO’s investments in ETFs cross ₹2 lakh crore, invest ₹13,017 crore this fiscal
Provident Fund Organisation (EPFO) has invested a little over ₹2 lakh crore in exchange-traded funds since 2018-19, which accounts for its exposure in equity markets. The minister said out of a total corpus of ₹18.3 lakh crore, the EPFO has invested 8.7% in ETFs and 91.3% in debt instruments including those of Public Account of India. The Minister of State of Labour was speaking in response to a question on investment of EPFO fund.
"The EPFO invests in equity markets through ETFs, replicating BSE Sensex and Nifty 50 indices. From time to time, EPFO has also invested in ETFs constructed specifically for disinvestment of shareholding of the Government of India in body corporates," he stated. The EPFO investments in ETFs have been on rising since 2018-19 when it invested ₹27,974 crore.
The corpus increased to ₹31,501 crore in 2019-20 and over the years it rose to ₹53,081 crore in 2022-23. In the current fiscal till July, the EPFO had invested ₹13,017 crore in ETFs. The retirement body has invested a total of ₹2,01,212 crore in ETFs since 2018-19 till July 2023.
The EPFO had begun investing in equities through ETFs in 2015-16 with an initial exposure of 5% of incremental deposits. This was gradually increased to 10%. The EPFO’s Central Board of Trustees, which is the apex decision making body, chaired by labour minister Bhupender Yadav, in its last meeting in March this year also decided to increase the exposure to 15% in a bid to improve returns for depositors.
“EPFO does not invest directly in individual stocks including stocks of any blue-chip company. EPFO invests in Equity markets through ETFs replicating BSE-Sensex and Nifty-50 indices," Teli said. The retirement body has also invested from time-to-time in ETFs
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