ET :Govt employees shifting savings to capital mkt - Study

Govt employees shifting savings to capital mkt: Study

Government employees, who earlier hesitated to park their savings in the capital market, are increasingly buying shares and mutual fund schemes in the expectation of higher returns, industry body Assocham said.

"Fifty eight per cent of government employees are choosing stocks and mutual funds as their preferred investment instruments," Assocham said in a survey on changing investment patterns of government employees. Out of a total 510 employees surveyed from middle and upper-middle ranks in the government and the PSUs, about 300 prefer investing in shares. This is followed by private and state-owned mutual funds, Assocham said in press release.

Huge investments in stocks and infrastructure has lured government employees to tilt toward capital market against traditional channels of investments in post offices, banks and other fixed deposit schemes, the survey said. Easy availability of advisory services by experts, which mitigates the risk of losses, is a major factor for investment in the stock market by employees.

"Despite stock market's volatile nature, element of risk taking is now getting into the psyche of government employees as a result of which domestic capital market is attracting protected lot of government employees also," Assocham President Venugopal Dhoot was quoted as saying in the release.

It said over 42 per cent respondents were keen to invest in shares of infrastructure, real estate, IT and automobile companies as the sectors were giving huge returns.

However, the survey said, 32 per cent of government employees, especially from the central government, are still choosing traditional routes of investments in post offices and banks schemes as they want safe returns.


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