Pension parking lot expanded to gold, AIFs, InvITs

Moreover, the pension regulator has allowed investments in initial public offers (IPOs) of firms if their full float market capitalisation (mcap) based on the lower band of issue price is equal to or higher than the mceap of the 250th firm in the NSE 250 Index.

- 

“There is too much of a herd mentality when it comes to picking stock investments, and so we have decided to expand the universe of stocks to invest in. The aim is to gradually provide more scope for fund managers to do active stock picking,” the PERDA chief said.

The regulator has also introduced commodities investments, starting with a 1 per cent cap on Sebi-regulated Gold and Silver ETFS, and eased conditions placed on debt instruments other than government securities, where fund managers are allowed to park 45 per cent of their corpus. 10 per cent of the debt portfolio no longer needs a ‘AA’ rating from two rating agencies, and there is some leeway for investments in infrastructure and affordable housing bonds issued by banks, even if they are rated lower than ‘AA’ (‘AA’ to ‘A’ rated debt).

Investment norms for the AIFs universe have been rationalised so that Real estate investment trusts (Reits), that are now treated as equities by the stock market regulator Sebi, are also treated in the same way by PFRDA. While AIF investments were permitted earlier, the structure was such that no investments qualified.