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With 25.05% SIP Returns In 5 Years, This Credit Risk Mutual Fund Is A Good Buy

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Credit funds, often known as credit opportunities funds or credit risk funds, are debt mutual fund schemes that invest in lower-rated stocks and bonds. Simply defined, these funds' portfolios are mostly comprised of riskier debt instruments, with the possibility of their issuers defaulting on loans not being eliminated. This credit risk fund that we have highlighted below has given good returns on long term SIP. Also, it has outperformed the category annual average returns. Read to know more!

 

Baroda BNP Paribas Credit Risk Fund - Direct Plan-Growth

Baroda BNP Paribas Credit Risk Fund - Direct Plan-Growth

This Credit Risk Fund fund from Baroda BNP Paribas Mutual fund house was launched on 23 January 2015. The is an open-ended medium-sized fund of its category. This fund has Rs204.65 Crore worth of Asset Under Management (AUM). The Net Asset Value (NAV) of this fund declared on 06th May 2022 is Rs 18.8688. The fund has an expense ratio of 0.85%, which is close to its category average expense ratio, however, it is slightly higher than the average expense ratio of the category. 

This fund is atop rated credit risk fund by the CRISIL and given 5-star. Also, it has shown very good performance among its peer funds. On risk level, it is rated moderately high risky for investment. Its benchmark is CRISIL Credit Risk Fund CII Index. To start investment in this fund, the minimum investment amount that is required is Rs 5,000 for a lump-sum payment and Rs 1,000 for additional investment. Whereas, for SIP it is Rs 500. It has no lock-in period. However, it charges 1% on redemption excess to 10% of the investment within 365 days. 

 

Absolute And Annualised Returns
 

Absolute And Annualised Returns

Lump-Sum Investment Returns

In the last 1-year, the fund has delivered 13.11% returns. Whereas since its inception, it has delivered 9.10% annual average returns.

TenureAbsolute ReturnsAnnualised Returns
1 Year13.11%13.11%
2 Year28.01%13.14%
3 Year25.99%8.00%
5 Year45.44%7.77%
Since Inception88.69%9.10%

SIP Returns

TenureAbsolute ReturnsAnnualised Returns
1 Year5.43%10.25%
2 Year14.57%13.71%
3 Year18.33%11.25%
5 Year25.05%8.88%
Portfolio

Portfolio

Fund has 86.08% investment in Debt of which 11.8% in Government securities, and 70.86% in funds invested in very low-risk securities.

The fund's credit profile is low indicating it has lent to borrowers whose quality is not too great. Most funds in this category lend to better borrowers and hence the risk of default in this fund is higher than in the category.

The fund's top holdings are in the Government of India, Tata Power Co. Ltd., Tata Motors Ltd., Godrej Properties Ltd., and Aspire Home Finance Corporation Ltd.

Disclaimer

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.

Story first published: Monday, May 9, 2022, 20:20 [IST]
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