In India, which of the following can trade in Corporate Bonds and Government Securities ?

1. Insurance Companies

2. Pension Funds

3. Retail Investors

Select the correct answer using the code given below :

This question was previously asked in
UPSC CSE Prelims 2024: General Studies Official Paper
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  1. 1 and 2 only
  2. 2 and 3 only
  3. 1 and 3 only
  4. 1, 2 and 3

Answer (Detailed Solution Below)

Option 4 : 1, 2 and 3
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Detailed Solution

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The correct answer is Option 4.

Key Points

  •  Insurance companies in India are allowed to trade in corporate bonds and government securities. They invest in these instruments as part of their investment portfolios to ensure stable and secure returns. Hence, Statement 1 is correct.
  • Pension funds in India can also trade in corporate bonds and government securities. These investments are part of their strategy to generate returns for pensioners while maintaining a balanced and secure portfolio. Hence, Statement 2 is correct.
  • Retail Investors: Retail investors in India have access to both corporate bonds and government securities. They can trade these instruments through stock exchanges or through various mutual funds and bond funds. Hence, Statement 3 is correct.
  • Insurance companies, pension funds, and retail investors in India can all trade in corporate bonds and government securities.
  • Therefore, the correct answer is option (4).
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