More volatility, low flexibility.
While MSF gives investors more choices, this plethora of options can lead to confusion.
Unless they are savvy or have access to quality advice, they could end up making
unsuitable decisions. For some, multiple schemes may mean more tracking and
monitoring, which could make management harder. Over-diversification with too many
schemes could also dilute returns.
With investors able to take up to 100 per cent equity exposure, portfolio volatility will rise.
There are also restrictions on movement. “The mandatory 15-year lock-in is highly
restrictive,” says Ranjit Jha, managing director & chief executive officer, Rurash Financials.
Jha cautions that investors close to retirement (under 10 years) or risk-averse individuals
should stay away. Subscribers uncomfortable with managing multiple schemes may also
avoid it.
Read the Full article at – https://www.business-standard.com/finance/personal-finance/nps-you-can-choose-100-equity-exposure-based-on-risk-appetite-timeline-125100200837_1.html