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A 55-year-old man, his wife and daughter were found dead in their house
near Kabirbaug in Narayan Peth on Sunday morning. The police suspect the family
died of suffocation from the smoke emanating from the burning of coal in an urn in
the bedroom. They reached late, but NPS ( National Pension System) investors
have finally joined the party in the capital markets. An analysis by ET shows
that NPS schemes have generated better returns than the provident fund. The
average NPS fund for Central government workers has given 10.35% returns since
launch, while the average state government scheme has delivered 10.84%.
The NPS schemes for the general public have also done very well, thanks to
the bullishness in the equity markets and the recent rally in bonds. The average
equity fund has generated 14.6%, while the corporate bond fund has given 10.6%.
Gilt funds have given average returns of 9.9%. These calculations are based on SIP
returns on monthly contributions from inception till December 2014. The high
returns should be music to the ears of the estimated 36 lakh government employees
(14 lakh central government and 22 lakh state government) who have nearly Rs
53,500 crore invested in NPS. Three pension funds manage this gigantic corpus,
which is almost 92% of the assets under management (AUM) of the NPS. But the
higher returns have been accompanied by greater volatility. The NPS funds did
very well in 2012-13, but gave pathetic returns in the following year.
As bond yields shot up in 2013-14, the SIP returns of the average Central
government fund was 5.4% while the average state government fund grew only
4.9%. The 18% returns from equities that year didn't help much as these funds had
only a small portion of their corpus in stocks. The Pension Fund Regulatory and
Development Authority (PFRDA) allows NPS managers to invest up to 15% in
equities, but no pension fund manager has ever hit that ceiling. As on November
30, 2014, the central government scheme of UTI Retirement Solution.