In India, which of the following can trade in Corporate Bonds and Government Securities ?
- Insurance Companies
- Pension Funds
- Retail Investors
Select the correct answer using the code given below :
1 and 2 only
2 and 3 only
1 and 3 only
1, 2 and 3
Answer is Right!
Answer is Wrong!
This question was previously asked in
UPSC IAS – 2024
1. Insurance Companies: Insurance companies are major investors in the debt market, including G-Secs and corporate bonds, primarily due to regulatory requirements to invest a certain percentage of their funds in approved securities and to match their long-term liabilities with long-term assets.
2. Pension Funds: Pension funds, such as EPFO and funds under the National Pension System (NPS), are also significant players in the debt market. They invest substantial amounts in G-Secs and corporate bonds as part of their long-term investment strategy to meet future pension obligations.
3. Retail Investors: Retail investors can invest in both government securities and corporate bonds. The RBI has introduced the RBI Retail Direct scheme to provide easier access for retail investors to G-Secs. Corporate bonds can be accessed by retail investors through stock exchange platforms, mutual funds, or direct placements, although participation might be lower compared to institutional investors or equity markets.