National Pension System: This NPS Fund Gave Over 15% Return In A Year

Amid the ongoing stock market volatility, cautious investors are looking at alternative investment options with a more stable return outlook. Many investors are exploring the potential in traditional investment opportunities such as the National Pension System (NPS). Introduced by the government, NPS is a long-term, market-linked retirement planning scheme.

It is a partly equity-linked scheme and focuses on asset allocation across segments including equity, corporate debt, government bonds, etc. Latest data from the Pension Fund Regulatory and Development Authority (PFRDA) shows the growth of assets under management (AUM) in the NPS has slowed to 20.3% year-on-year, reaching Rs 13.83 lakh crore as of March 1, as per a report by Business Today. This slowdown is attributed to a decline in equity benchmarks.

After touching an all-time high of over 26,000 points on September 27, 2024, Nifty 50 has dropped more than 17% from the peak. The key index was trading at 22,462 on Monday in morning trade. Similarly, BSE Sensex touched a record high of over 85,000 points on September 27, and it has declined almost 16% from the all-time high, giving a massive jolt to the investors.

On the other hand, NPS AUM reached Rs 13.9 lakh crore by Feb. 15, reflecting a higher year-on-year growth rate of 22.2%, before declining due to the impact of stock market volatility. Of the Rs 14 lakh crore in NPS AUM, around Rs 3 lakh crore has been invested in equity schemes.

Regardless, there is one NPS fund making headlines for its impressive returns exceeding 15.06% in Tier I equity over the past year, as of Mar. 13, 2025. The DSP NPS Tier I equity scheme has outperformed its peers, delivering far better returns than other Tier I equity schemes within NPS, as per the BT report.

The Equity Tier I scheme offered by DSP has achieved a return of 15.06% in the previous year, while other schemes have struggled to cross 5% returns during this period, the report said.

For instance, UTI Pension Fund's equity scheme delivered a return of 4.63%. Meanwhile, SBI NPS equity scheme was down 2.12% and Aditya Birla Equity Pension Fund, on the other hand, provided a 1.7% return, it added.