India’s Short-Term Funds: Performance Review 2024

India’s mutual fund landscape continues to offer varied options for investors, with ultra short-term and short-term funds presenting distinct characteristics. An analysis of offerings from PGIM India, Sundaram, Kotak, and JM Financial highlights their specific performance metrics, asset allocations, and credit quality as of late June 2024.

PGIM India Ultra Short Term Fund Overview

The PGIM India Ultra Short Term Fund – Premium Plus Plan, categorised as an Ultra Short Duration Fund, reported its Net Asset Value (NAV) at ₹1,000.00 on June 28, 2024. This fund manages a substantial Asset Under Management (AUM) of ₹2,851.64 crore as of May 31, 2024, operating with a direct plan expense ratio of 0.18%. Launched on January 19, 2016, the fund is managed by Puneet Pal and carries no exit load.

• NAV (June 28, 2024): ₹1,000.00
• Expense Ratio (Direct Plan): 0.18%
• AUM (May 31, 2024): ₹2,851.64 crore
• Average Maturity: 0.49 years
• Yield to Maturity (YTM): 7.81%

Its asset allocation shows 95.20% in debt and 4.80% in cash equivalents. Commercial Papers constitute the largest portion of its debt instruments at 40.01%, with Government Securities at 15.46%. The fund maintains a robust credit profile, with 53.33% of its holdings rated AAA and 27.46% rated AA.

Sundaram Ultra Short Duration Fund Insights

The Sundaram Ultra Short Duration Fund Regular-IDCW Fortnightly, another Ultra Short Duration Fund, also recorded an NAV of ₹1,000.00 on June 28, 2024. Its AUM stood at ₹1,268.49 crore as of May 31, 2024, with a direct plan expense ratio of 0.19%. Dwijendra Srivastava manages this fund, which commenced operations on May 22, 2007, and has no exit load.

• NAV (June 28, 2024): ₹1,000.00
• Expense Ratio (Direct Plan): 0.19%
• AUM (May 31, 2024): ₹1,268.49 crore
• Average Maturity: 0.43 years
• Yield to Maturity (YTM): 7.82%

This fund allocates 96.34% to debt and 3.66% to cash and equivalents. Commercial Papers dominate its debt instruments at 46.80%, followed by Certificate of Deposits at 20.48%. A significant 67.09% of its portfolio holds AAA-rated instruments, reflecting a strong credit quality.

Kotak Ultra Short to Short Term Fund Analysis

The Kotak Ultra Short to Short Term Fund – Standard Plan – Direct Plan, classified as a Short Duration Fund, had an NAV of ₹1,000.00 on June 28, 2024. It boasts a considerably larger AUM of ₹14,978.88 crore as of May 31, 2024, with a direct plan expense ratio of 0.25%. Managed by Abhishek Bisen, this fund was launched on January 1, 2013, and imposes no exit load.

• NAV (June 28, 2024): ₹1,000.00
• Expense Ratio (Direct Plan): 0.25%
• AUM (May 31, 2024): ₹14,978.88 crore
• Average Maturity: 1.03 years
• Yield to Maturity (YTM): 7.80%

Debt instruments account for 92.20% of its allocation, with cash and equivalents at 7.80%. Commercial Papers are the largest component at 30.33%, followed by Corporate Debt at 25.26%. The fund’s credit profile includes 58.75% in AAA-rated assets and 28.32% in AA-rated assets.

JM Dynamic Bond Fund Performance Metrics

The JM Dynamic Bond Fund – Regular Plan – Growth, a Dynamic Bond Fund, registered an NAV of ₹1,000.00 on June 28, 2024. This fund holds a smaller AUM of ₹17.65 crore as of May 31, 2024, with a direct plan expense ratio of 0.34%. Vikas Agrawal manages the fund, which began on December 29, 2006.

• NAV (June 28, 2024): ₹1,000.00
• Expense Ratio (Direct Plan): 0.34%
• AUM (May 31, 2024): ₹17.65 crore
• Average Maturity: 2.67 years
• Yield to Maturity (YTM): 7.84%

Its asset allocation consists of 95.53% in debt and 4.47% in cash and equivalents. Government Securities form the largest part of its debt holdings at 38.92%, with Corporate Debt at 35.79%. The fund has a credit distribution including 40.06% in AAA-rated instruments and 27.65% in AA-rated instruments. An exit load of 1.00% applies if redeemed within three months, with no load thereafter.

These diverse mutual fund offerings provide investors with various risk-return profiles across ultra short-term, short-term, and dynamic bond categories, each with distinct asset compositions and credit quality benchmarks. Understanding these detailed metrics is crucial for informed investment decisions in the Indian market.