PFRDA notifies changes in investment norms for pension fund

India Infoline News Service | Mumbai |

Pension funds should undertake their own due diligence of assessment of risk associated with securities before investments.

The PFRDA (Pension Fund Regulatory and Development Authority) on 15 October 2013 has notified changes in the investment guidelines to all pension funds.

“Debt securities selected for investments should have a minimum residual maturity period of 3 years from the date of investment by the pension fund,” the PFRDA said in a notification to all pension funds for the government sector.

The debt securities must have an investment grade rating from at least two credit rating agencies.

Pension funds should undertake their own due diligence of assessment of risk associated with securities before investments, it said.

Credit Default Swaps (CDS) on corporate bonds are also eligible derivative instruments, it said.
 

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