Explanation:

• The centre is planning to launch India’s first fixed income Exchange Traded Fund (ETF) comprising debt securities of large central public sector enterprises (PSUs).
• The ETF is expected to have a size of Rs 15,000 crore to Rs 20,000 crore.
• The fund will comprise only AAA-rated papers of the PSU companies.
• It provides a new option to conservative investors to own securities of government-owned companies along with the facility of overnight liquidity as ETF units will be listed on exchanges.
• Compared with bank fixed deposits that generate a post-tax return of around 5.5 per cent, this product could generate a return of over 7 per cent for the investors.
• It can comprise corporate debt securities in the form of bonds, credit-linked note, debentures, promissory notes as underlying instruments.
• Exchange Traded Funds (ETFs) are mutual funds listed and traded on stock exchanges like shares.In an ETF, one can buy and sell units at prevailing market price on a real time basis during market hours.