Based On 1 Year Investment, This Credit Risk Fund Has Given 142.77% Absolute Returns, Outperformed Benchmark

In the last year, Credit Risk Mutual Fund schemes that invest at least 65 per cent of their assets in instruments rated below AAA have delivered double-digit returns. In the meantime, many debt mutual funds are delivering returns in the single digits. According to Value Research, a mutual fund research agency, the credit risk category has yielded an average annual return of 15.82 per cent. Here, we highlighted one such fund. This fund outperformed the returns on 1 year investment.

BOI AXA Credit Risk - Direct Plan-Growth

It is a 7-Year-old Credit Risk mutual fund scheme launched on 27 February 2005 by the BOI AXA Mutual Fund. It is a small Credit Risk fund. The size of Assets Under Management (AUM) of the fund is Rs 167.96 Crore, whereas, the Net Asset Value (NAV) declared on 02nd June 2022 is Rs 10.4072. The fund has an expense ratio of 1.28%, which is higher compared to its category average expense ratio of 0.72%.

It is a moderately high risky Fund for investments. However, it is rated 1 star by the CRISIL. It is an open-ended debt scheme predominantly investing in AA and below rated corporate bonds (excluding AA+ rated corporate bonds. A Moderate Interest Rate Risk and Relatively High Credit Risk. There will be no exposure in the portfolio to dated Government Securities and State Development Loans. 

Investing in this fund required a minimum investment amount of Rs 5,000. Whereas a minimum of Rs 5,000 is required for additional investment. It has no lock-in period. However, it charges exit load within 3 investment periods. These are as follows: 1) 4% for redemption within 365 days , 2) 3% for redemption between 366 - 730 days, and 3) 2% for redemption between 731 - 1095 days. 

Absolute & Annualised Returns

Lump-Sum Investment Returns

It has given negative absolute returns on 3 and 5-year investments. However, it outperformed on 1-year investment. Since its launch, it has delivered 0.51% average annual returns.

Tenure	Absolute Returns	Annualised Returns
1 Year	142.77%	142.77%
2 Year	179.32%	67.13%
3 Year	-16.56%	-5.84%
5 Year	-16.78%	-3.61%
Since Inception	4.07%	0.55%

SIP Returns

Tenure	Absolute Returns	Annualised Returns
1 Year	113.18%	259.07%
2 Year	137.63%	110.76%
3 Year	108.52%	54.07%
5 Year	56.73%	18.02%

Portfolio

The fund has 94.68% investment in Debt, of which, 54% is in Low-Risk securities. The fund's top holdings are in Sheba Properties Ltd., Vedanta Ltd., Piramal Housing Finance Ltd., Godrej Industries Ltd., and Manappuram Finance Ltd.

Disclaimer

Mutual fund investments are subject to market risk. Read all scheme related documents, and Terms and Conditions carefully before investing. The above-mentioned information is purely informational and doesn't guarantee any return. The Greynium Information Technologies and the Author are not liable for any losses caused as a result of a decision based on the article.