IDFC Low Duration Fund (Growth)

IDFC Low Duration Fund-Growth is an open-ended low-duration debt mutual fund scheme provided by IDFC Mutual Fund. It predominantly invests in high quality debt and money market instruments. The scheme aims to generate a relatively stable return on investment at par with inflation with a lower risk strategy. Earlier, the fund was known as IDFC US/T Reg Gr. It aims to outperform the benchmark with risk lower than the benchmark. The fund is managed by IDFC Asset Management Company Limited. Mr. Anurag Mittal manages the fund managers.

IDFC Low Duration  Fund-Growth Investment Objective

The investment objective of the Scheme is to generate relatively stable returns with a low risk strategy. The Scheme seeks to offer an investment avenue for short term savings by looking to generate returns commensurate with a low risk strategy from a portfolio that is invested in debt and money market securities such that the Macaulay duration of the portfolio is between 6 months and 12 months. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved. The fund invests around 88% of its assets in debt instruments. Within this debt investment, its investment in government securities is 10.50% while it invests the remaining 77.50% in very low-risk securities.

IDFC Low Duration  Fund-Growth Scheme Details

On 17th January 2006, IDFC Mutual Fund had launched the scheme. The scheme has been in existence for the past 15 years. Since inception, it continues to provide consistent growth of investment at par with inflation over the investment duration.

NAV and Returns – As of 23rd June 2021, the NAV of the fund is Rs 30.52. The fund’s risk-o-meter is low to moderate risk. Hence, the investor investing in the fund must recognize that their principal investment is at a low to moderate risk. Since its inception, the fund has delivered a return of 7.50% on investment.

Minimum Investment – The fund has a minimum SIP investment requirement of Rs 1000 and a minimum lump sum investment of Rs 5000

Expense Ratio and Exit Load – The funds charges an expense ratio of 0.51%. Here, the expense ratio is close to the expense ratio charged by other AMCs for funds under the similar category. No exit load is charged on the redemption of the units of the fund.

Fund Manager – Currently, Mr. Anurag Mittal is managing the fund. Mr. Anurag Mittalis Associate Director – Fund Management at IDFC Asset Management Company Limited. He has been co-managing the fund since 9th November 2015. Mr. Mittal has experience of over 10 years in fund management and research. 

Other Details – No lock-in period for the scheme, you can redeem any amount of investment anytime. The AUM of IDFC Low Duration  Fund as of 23rd June 2021 is Rs 9,575 cr. The fund benchmarks to NIFTY Low Duration Debt Index TR INR.

IDFC Low Duration  Fund-Growth Top Stock Holdings

The IDFC Low Duration Fund-Growth has invested its assets majorly in the debt instruments of the following companies:

Asset Allocation of IDFC Low Duration  Fund-Growth

The IDFC Low Duration  Fund-Growth has invested in the following debt instruments:

IDFC Low Duration  Fund-Growth Review

IDFC Low Duration Fund-Growth is recommended by Scripbox for investment within low duration mutual funds. Low duration funds provide relative safety of capital amount invested. It also provides growth of principal at par with inflation over the investment duration. 

1. These funds are suitable for investors who seek short-term optimal returns with relative stability and investment for 1-5 years or longer.
2. The fund has an extended history of 15 years for analysis. Moreover, the track record is excellent.
3. With an AUM or relative size of Rs 9,575 cr, the relative size of the fund is large in comparison to other similar funds in the low duration fund category.
4. The scheme has performed well consistently over a period of time outperforming its benchmark.
5. The impact of interest rate changes on fund value is quite low in comparison to other similar funds. 
6. The fund has a high credit quality compared to other low duration debt funds in the same category. Moreover, the asset quality is AAA equivalent. This indicates that it has lent to borrowers whose credit quality is good. With better borrowers, it ensures a low default risk or credit risk. 

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The algorithm scores financial products on multiple parameters, giving relevant weights to each of the listed parameters, such as:

• Track record of the product – how long has it been around?
• Assets under management – how big is it – for example, the size of a mutual fund
• Liquidity – how easy is it to move in or out of the product?
• Consistency of performance – how much have the returns fluctuated?
• The risk associated with the product – what risks impact the product?
• Quality of underlying assets – we assess how risky the underlying assets are – for example, by considering bond ratings in the case of debt funds

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