Trends & Comparative Analysis of Asset Classes for All Citizens National Pension System (NPS) Tier I Account: Equity, Corporate Bonds, and Government Securities (G-Secs)

Abstract

The study examines the trends and comparative performance of asset classes with respect to all citizens National Pension System (NPS) Tier I account over a decade (FY2015-FY2024). It focuses on equity, corporate bonds, and government securities (G-Secs). The research also analyses Net Asset Value (NAV), Assets Under Management (AUM), and subscriber growth to understand scheme dynamics. The research endeavours to examine PFMs performance. The study uses secondary data from the NPS database to understand returns. Descriptive statistics characterize asset class performance, while correlation identifies variable relationships. Regression analysis predicts NAV trends based on AUM, and evaluates performance. NPS analysis reveals that APY's subscriber growth complements strong AUM gains. The strategic asset allocation, notably by UTI PFM in equity/bonds and Kotak PFM in G-Secs, drives superior risk-adjusted returns. It indicates APY’s success in expanding coverage, strong AUM, subscriber growth, and influence of individual asset classes. Regression results exhibit a connect between AUM and NAV growth for the six PFMs. LIC's outperformance against the benchmark, and UTI’s results in equity and corporate bonds reveals strategy importance. Practical implications highlight the need for diversified strategies and enhanced investor education. Policymakers and PFMs should understand risk assessment and portfolio enhancement.