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The EPFO board will also consider a proposal to give extension of six more months to its five fund managers SBI, ICICI Securities Primary Dealership, Reliance Capital, HSBC AMC and UTI AMC for managing its corpus, according to the agenda listed for the trustees’ meet scheduled on Tuesday.
Retirement fund body Employees Provident Fund Organisation’s (EPFO) trustees will consider widening the range of equity linked schemes or exchange traded funds (ETFs) to maximise returns on its investments in stock markets. Besides, the EPFO board will also consider a proposal to give extension of six more months to its five fund managers SBI, ICICI Securities Primary Dealership, Reliance Capital, HSBC AMC and UTI AMC for managing its corpus, according to the agenda listed for the trustees’ meet scheduled on Tuesday.
The five fund managers were appointed for three years from April 1, 2015. They were given extension till June 30, 2018. Now, it has been proposed to give the five fund managers further extension till December 31, 2018 or till the time of appointment of new fund managers. The EPFO has been investing in ETFs and wants to enhance its range to maximise returns on its investments in stock markets. Presently, it has invested in UTI Mutual Fund, SBI Mutual Fund, CPSE ETF and Bharat 22, a senior official said.
The body got the maximum appreciation on its investments in UTI Mutual Fund, for which rate of return was 17.01%, with total value at Rs 8,995.04 crore. This was followed by 16.07% return on Rs 34,603.64 crore invested in SBI Mutual Fund. The CPSE ETF gave a return of 7.94% at an investment of Rs 1,860.81 crore, whereas an investment of Rs 2,024.75 crore in Bharat 22 fetched a return of 8.46%. Thus, the EPFO wants to look for more rewarding options in equity linked schemes.
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The EPFO had started investing in ETFs in 2015 with a mandate of investing 5% of its investible deposits in the equity linked scheme. This was increased to 10% in 2016-17 and 15% in 2017-18. The trustees may deliberate to increase the quantum of investment in ETFs from present 15% of the investible deposits. But that could be done only after amendment to the investment pattern for private provident funds by the finance ministry.
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