This week the Employees’ Provident Fund Organisation (EPFO) decided to invest a part of its corpus in AA+ bonds.
Of the current investment
of Rs 15,000 crore, it has decided to invest Rs 3,000 crore in AA+ bonds.
The balance Rs 12,000 crore will still be invested in AAA bonds.
It has made this move to earn higher returns
in a falling interest-rate
Does this put my EPF corpus at any risk?
Not really. According to Crisil’s definition, those with AA rating are deemed to carry high safety. The EPFO
will take a few additional precautions. It will invest only in those bonds that have been rated AA+ by at least two rating agencies, have been profitable for the past three consecutive years, and have a net worth of over Rs 1,000 crore. This should put investors at ease.