IDBI MF launches short-term bond fund

IDBI Mutual Fund’s, latest  new fund offer, IDBI Short Term Bond Fund, an open-ended debt scheme will open for subscription tomorrow. And will close next week, on March 22.

The investment objective of the fund, to be managed by Gautam Kaul, is to provide investors with regular income through an allocation of the investment corpus in a diversified portfolio of debt and money market instruments. Its performance will be benchmarked against CRISIL Short Term Bond Fund Index.

The scheme will invest 65-100% of the funds in debt / money market instruments (including floating rate debt instruments and securitised debt) with a maturity of maximum 2 years. It may also invest 0-35% in debt instruments (including floating rate debt instruments and securitised debt) with maturity over 2 years but not exceeding 3 years.

The scheme will re-open for continuous sale and repurchase from March 24.

Speaking on the NFO, Gautam Kaul, fund manager, fixed income, IDBI Asset Management, said, "With short-term rates at current levels, we believe that risk-reward is favourable and provides both attractive carry yield and an opportunity for capital gains."