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7 Best Arbitrage Mutual Funds 2023
Generally, people willing to invest in arbitrage funds look for the best arbitrage funds. But what are Arbitrage funds?
An arbitrage fund is a popular short-term financial investment in India. Arbitrage funds are Mutual Funds that leverage the differential price between the cash Market and derivative market to generate mutual fund returns.
The returns generated by arbitrage funds are dependent on the Volatility of the stock market. Arbitrage mutual funds are hybrid in nature and in times of high or persistent volatility, these funds offer relatively risk-free returns to investors. Before Investing in these funds it is important to understand arbitrage funds taxation and know the best arbitrage funds.
Why Invest in Arbitrage Funds?
Here are some of the benefits of investing in arbitrage funds:
1. Negligible Risk
Arbitrage funds are not 100% risk-free but they do carry negligible risk. They Bank on the mispricing happening in the markets. This gives the investor a safer option compared to other short-term funds since these funds offer better returns during market volatility.
2. Returns
These funds generally give a return of about 7-9% of the amount invested. This is higher compared to Liquid Funds or short-term debt funds in low rate enviornment (When RBI is reducing rate).
Thus, making arbitrage funds a lucrative investment option.
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3. Favourable Taxation
One of the biggest benefits of investing in these funds is the tax treatment. Equity Funds attract long term Capital gains. If the gains are made up to INR 1 lakh then it counts under tax-free. Tax at 10% applies to gains above INR 1 lakh.
Arbitrage Funds Taxation
As mentioned above, these funds are taxed favourably. They are said to be a combination of good Debt fund returns and the tax treatment of equity mutual funds. Arbitrage schemes are taxed similar to equity funds making it an attractive investment for people in higher tax brackets. For example, if you belong to a 30% tax bracket, investing in equity arbitrage funds can lower your tax rates to 10% for LTCG and 15% for STCG.
Top 7 Arbitrage Mutual Funds 2023 - 2024
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 5 YR (%) 2022 (%) Invesco India Arbitrage Fund Growth ₹27.1422
↑ 0.02 ₹3,185 1.7 3.3 5.8 4.5 5 5.1 SBI Arbitrage Opportunities Fund Growth ₹28.7326
↑ 0.02 ₹8,801 1.8 3.2 5.4 4.2 4.9 4.6 Kotak Equity Arbitrage Fund Growth ₹31.7805
↑ 0.02 ₹21,918 1.8 3.2 5.3 4.4 5.1 4.5 Edelweiss Arbitrage Fund Growth ₹16.4968
↑ 0.01 ₹5,393 1.7 3 5.1 4.3 5 4.4 HDFC Arbitrage Fund Growth ₹26.084
↑ 0.01 ₹5,886 1.7 3.1 5 4.1 4.7 4.2 ICICI Prudential Equity Arbitrage Fund Growth ₹29.2033
↑ 0.01 ₹11,273 1.7 3 5 4.3 4.9 4.2 IDFC Arbitrage Fund Growth ₹27.6615
↑ 0.02 ₹3,630 1.7 3 4.9 4 4.8 4.1 Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 24 Mar 23
*Below is the list of Arbitrage funds sorted on last 1 year return and having AUM > 100 Crore.
The primary investment objective of the scheme is to generate income through arbitrage opportunities emerging out of mis-pricing between the cash market and the derivatives market and through deployment of surplus cash in fixed income instruments. Invesco India Arbitrage Fund is a Hybrid - Arbitrage fund was launched on 30 Apr 07. It is a fund with Moderately Low risk and has given a Below is the key information for Invesco India Arbitrage Fund Returns up to 1 year are on To provide capital appreciation and regular income for unitholders by identifying profitable arbitrage opportunities between the spot and derivative market segments as also through investment of surplus cash in debt and money market instruments. SBI Arbitrage Opportunities Fund is a Hybrid - Arbitrage fund was launched on 3 Nov 06. It is a fund with Moderately Low risk and has given a Below is the key information for SBI Arbitrage Opportunities Fund Returns up to 1 year are on The investment objective of the scheme is to generate capital appreciation and income by predominantly investing in arbitrage opportunities in the cash and derivatives segment of the equity market, and by investing the balance in debt and money market instruments. However, there is no assurance that the objective of the scheme will be realized Kotak Equity Arbitrage Fund is a Hybrid - Arbitrage fund was launched on 29 Sep 05. It is a fund with Moderately Low risk and has given a Below is the key information for Kotak Equity Arbitrage Fund Returns up to 1 year are on The investment objective of the Scheme is to generate income by predominantly investing in arbitrage opportunities in the cash and the derivative segments of the equity markets and the arbitrage opportunities available within the derivative segment and by investing the balance in debt and money market instruments. However, there is no assurance that the investment objective of the scheme will be realized. Edelweiss Arbitrage Fund is a Hybrid - Arbitrage fund was launched on 27 Jun 14. It is a fund with Moderately Low risk and has given a Below is the key information for Edelweiss Arbitrage Fund Returns up to 1 year are on "To generate income through arbitrage opportunities between cash and derivative market and arbitrage opportunities within the derivative segment and by deployment of surplus cash in debt securities and money market instruments." HDFC Arbitrage Fund is a Hybrid - Arbitrage fund was launched on 23 Oct 07. It is a fund with Moderately Low risk and has given a Below is the key information for HDFC Arbitrage Fund Returns up to 1 year are on The investment objective of Income Optimiser Plan under the scheme is to seek to generate low volatility returns by using arbitrage and other derivative strategies in equity markets and investments in short-term debt portfolio. ICICI Prudential Equity Arbitrage Fund is a Hybrid - Arbitrage fund was launched on 30 Dec 06. It is a fund with Moderate risk and has given a Below is the key information for ICICI Prudential Equity Arbitrage Fund Returns up to 1 year are on The investment objective of the Scheme is to generate capital appreciation and
income by predominantly investing in arbitrage opportunity in the cash and
the derivative segments of the equity markets and the arbitrage opportunity
available within the derivative segments and by investing the balance in debt
and money market instruments. However there is no assurance that the
investment objective of the scheme will be realized. IDFC Arbitrage Fund is a Hybrid - Arbitrage fund was launched on 21 Dec 06. It is a fund with Moderately Low risk and has given a Below is the key information for IDFC Arbitrage Fund Returns up to 1 year are on 1. Invesco India Arbitrage Fund
CAGR/Annualized return of 6.5% since its launch. Ranked 9 in Arbitrage category. Return for 2022 was 5.1% , 2021 was 3.5% and 2020 was 4.3% . Invesco India Arbitrage Fund
Growth Launch Date 30 Apr 07 NAV (24 Mar 23) ₹27.1422 ↑ 0.02 (0.06 %) Net Assets (Cr) ₹3,185 on 28 Feb 23 Category Hybrid - Arbitrage AMC Invesco Asset Management (India) Private Ltd Rating ☆☆☆ Risk Moderately Low Expense Ratio 1.02 Sharpe Ratio -0.13 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-15 Days (0.5%),15 Days and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,557 29 Feb 20 ₹11,240 28 Feb 21 ₹11,617 28 Feb 22 ₹12,083 28 Feb 23 ₹12,731 Returns for Invesco India Arbitrage Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.7% 6 Month 3.3% 1 Year 5.8% 3 Year 4.5% 5 Year 5% 10 Year 15 Year Since launch 6.5% Historical performance (Yearly) on absolute basis
Year Returns 2022 5.1% 2021 3.5% 2020 4.3% 2019 5.9% 2018 5.9% 2017 5.5% 2016 6.5% 2015 7.6% 2014 8.3% 2013 7.9% Fund Manager information for Invesco India Arbitrage Fund
Name Since Tenure Deepak Gupta 11 Nov 21 1.22 Yr. Kuber Mannadi 1 Sep 22 0.42 Yr. Data below for Invesco India Arbitrage Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 97.83% Debt 2.69% Equity Sector Allocation
Sector Value Financial Services 30.28% Basic Materials 15.03% Industrials 7.24% Consumer Cyclical 5.39% Energy 3.98% Technology 2.91% Health Care 2.83% Utility 1.91% Communication Services 1.84% Consumer Defensive 0.93% Real Estate 0.67% Debt Sector Allocation
Sector Value Cash Equivalent 90.96% Corporate 5.7% Government 3.86% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity Invesco India Liquid Dir Gr
Investment Fund | -17% ₹513 Cr 1,679,811
↑ 147,464 Future on Kotak Mahindra Bank Ltd
Derivatives | -6% -₹191 Cr 1,099,600
↑ 102,400 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Aug 22 | KOTAKBANK6% ₹190 Cr 1,099,600
↑ 102,400 Icici Bank Limited February 2023 Future
Derivatives | -6% -₹179 Cr 2,132,900
↑ 2,132,900 ICICI Bank Ltd (Financial Services)
Equity, Since 30 Apr 22 | ICICIBANK6% ₹177 Cr 2,132,900
↑ 1,644,300 Invesco India US/T Dir Gr
Investment Fund | -5% ₹161 Cr 668,086
↑ 542,563 Future on Bajaj Finserv Ltd
Derivatives | -4% -₹116 Cr 854,000
↑ 559,500 Bajaj Finserv Ltd (Financial Services)
Equity, Since 31 Oct 22 | 5329784% ₹115 Cr 854,000
↑ 559,500 Future on Reliance Industries Ltd
Derivatives | -4% -₹109 Cr 460,000
↑ 409,000 Reliance Industries Ltd (Energy)
Equity, Since 31 Dec 22 | RELIANCE4% ₹108 Cr 460,000
↑ 409,000 2. SBI Arbitrage Opportunities Fund
CAGR/Annualized return of 6.7% since its launch. Ranked 15 in Arbitrage category. Return for 2022 was 4.6% , 2021 was 4% and 2020 was 3.5% . SBI Arbitrage Opportunities Fund
Growth Launch Date 3 Nov 06 NAV (24 Mar 23) ₹28.7326 ↑ 0.02 (0.06 %) Net Assets (Cr) ₹8,801 on 28 Feb 23 Category Hybrid - Arbitrage AMC SBI Funds Management Private Limited Rating ☆☆ Risk Moderately Low Expense Ratio 0.85 Sharpe Ratio -0.82 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-1 Months (0.5%),1 Months and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,580 29 Feb 20 ₹11,283 28 Feb 21 ₹11,559 28 Feb 22 ₹12,078 28 Feb 23 ₹12,668 Returns for SBI Arbitrage Opportunities Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.8% 6 Month 3.2% 1 Year 5.4% 3 Year 4.2% 5 Year 4.9% 10 Year 15 Year Since launch 6.7% Historical performance (Yearly) on absolute basis
Year Returns 2022 4.6% 2021 4% 2020 3.5% 2019 6% 2018 6.2% 2017 5.3% 2016 6.4% 2015 7.3% 2014 8.6% 2013 9% Fund Manager information for SBI Arbitrage Opportunities Fund
Name Since Tenure Neeraj Kumar 5 Oct 12 10.33 Yr. Arun R. 30 Jun 21 1.59 Yr. Data below for SBI Arbitrage Opportunities Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 99.95% Debt 0.37% Equity Sector Allocation
Sector Value Financial Services 31.64% Basic Materials 9.05% Energy 7.85% Industrials 7.55% Consumer Cyclical 4.24% Utility 2.81% Consumer Defensive 2.34% Health Care 2.15% Technology 2% Communication Services 1.61% Real Estate 1.13% Debt Sector Allocation
Sector Value Cash Equivalent 93.44% Corporate 3.5% Government 3.38% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity SBI Savings Dir Gr
Investment Fund | -10% ₹808 Cr 217,923,843 Future on Kotak Mahindra Bank Ltd
Derivatives | -5% -₹451 Cr 2,589,200
↑ 1,361,600 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Aug 22 | KOTAKBANK5% ₹448 Cr 2,589,200
↑ 1,361,600 Future on ICICI Bank Ltd
Derivatives | -5% -₹436 Cr 5,190,500
↑ 5,190,500 ICICI Bank Ltd (Financial Services)
Equity, Since 30 Jun 21 | ICICIBANK5% ₹432 Cr 5,190,500
↑ 2,919,000 Future on Reliance Industries Ltd
Derivatives | -5% -₹420 Cr 1,769,000
↑ 1,254,750 Reliance Industries Ltd (Energy)
Equity, Since 30 Nov 21 | RELIANCE5% ₹416 Cr 1,769,000
↑ 1,254,750 Future on HDFC Bank Ltd
Derivatives | -5% -₹382 Cr 2,362,800
↑ 671,550 HDFC Bank Ltd (Financial Services)
Equity, Since 30 Apr 22 | HDFCBANK5% ₹379 Cr 2,362,800
↑ 671,550 Future on Adani Ports & Special Economic Zone Ltd
Derivatives | -3% -₹249 Cr 4,036,250
↑ 695,000 3. Kotak Equity Arbitrage Fund
CAGR/Annualized return of 6.8% since its launch. Ranked 2 in Arbitrage category. Return for 2022 was 4.5% , 2021 was 4% and 2020 was 4.3% . Kotak Equity Arbitrage Fund
Growth Launch Date 29 Sep 05 NAV (24 Mar 23) ₹31.7805 ↑ 0.02 (0.06 %) Net Assets (Cr) ₹21,918 on 28 Feb 23 Category Hybrid - Arbitrage AMC Kotak Mahindra Asset Management Co Ltd Rating ☆☆☆☆ Risk Moderately Low Expense Ratio 0.63 Sharpe Ratio -0.97 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-30 Days (0.25%),30 Days and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,613 29 Feb 20 ₹11,305 28 Feb 21 ₹11,703 28 Feb 22 ₹12,208 28 Feb 23 ₹12,790 Returns for Kotak Equity Arbitrage Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.8% 6 Month 3.2% 1 Year 5.3% 3 Year 4.4% 5 Year 5.1% 10 Year 15 Year Since launch 6.8% Historical performance (Yearly) on absolute basis
Year Returns 2022 4.5% 2021 4% 2020 4.3% 2019 6.1% 2018 6.3% 2017 5.8% 2016 6.7% 2015 7.5% 2014 9% 2013 9.2% Fund Manager information for Kotak Equity Arbitrage Fund
Name Since Tenure Hiten Shah 3 Oct 19 3.33 Yr. Data below for Kotak Equity Arbitrage Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 97.6% Debt 2.97% Equity Sector Allocation
Sector Value Financial Services 25.79% Basic Materials 9.76% Industrials 8.34% Energy 6.91% Consumer Cyclical 6.6% Technology 4.13% Health Care 3.42% Consumer Defensive 2.94% Communication Services 2.69% Utility 2.27% Real Estate 1.15% Debt Sector Allocation
Sector Value Cash Equivalent 89.68% Corporate 5.94% Government 4.95% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity Kotak Money Market Dir Gr
Investment Fund | -13% ₹2,856 Cr 7,553,686 ICICI Bank Ltd.-FEB2023
Derivatives | -5% -₹1,196 Cr 14,239,400
↑ 14,239,400 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Dec 19 | ICICIBANK5% ₹1,185 Cr 14,239,400
↑ 7,420,700 RELIANCE INDUSTRIES LTD.-FEB2023
Derivatives | -5% -₹1,079 Cr 4,549,750
↑ 4,549,750 Reliance Industries Ltd (Energy)
Equity, Since 31 May 18 | RELIANCE5% ₹1,071 Cr 4,549,750
↑ 1,472,750 Kotak Savings Fund Dir Gr
Investment Fund | -5% ₹1,045 Cr 277,915,116 HDFC Bank Ltd.-FEB2023
Derivatives | -4% -₹836 Cr 5,172,750
↑ 5,172,750 HDFC Bank Ltd (Financial Services)
Equity, Since 30 Apr 22 | HDFCBANK4% ₹829 Cr 5,172,750
↑ 4,135,450 Kotak Liquid Dir Gr
Investment Fund | -3% ₹679 Cr 1,510,222 State Bank Of India-FEB2023
Derivatives | -2% -₹488 Cr 8,743,500
↑ 8,743,500 4. Edelweiss Arbitrage Fund
CAGR/Annualized return of 5.9% since its launch. Ranked 1 in Arbitrage category. Return for 2022 was 4.4% , 2021 was 3.8% and 2020 was 4.5% . Edelweiss Arbitrage Fund
Growth Launch Date 27 Jun 14 NAV (24 Mar 23) ₹16.4968 ↑ 0.01 (0.05 %) Net Assets (Cr) ₹5,393 on 28 Feb 23 Category Hybrid - Arbitrage AMC Edelweiss Asset Management Limited Rating ☆☆☆☆☆ Risk Moderately Low Expense Ratio 1.09 Sharpe Ratio -1.31 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-30 Days (0.25%),30 Days and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,601 29 Feb 20 ₹11,297 28 Feb 21 ₹11,708 28 Feb 22 ₹12,200 28 Feb 23 ₹12,761 Returns for Edelweiss Arbitrage Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.7% 6 Month 3% 1 Year 5.1% 3 Year 4.3% 5 Year 5% 10 Year 15 Year Since launch 5.9% Historical performance (Yearly) on absolute basis
Year Returns 2022 4.4% 2021 3.8% 2020 4.5% 2019 6.2% 2018 6.1% 2017 5.8% 2016 6.7% 2015 8% 2014 2013 Fund Manager information for Edelweiss Arbitrage Fund
Name Since Tenure Dhawal Dalal 22 Dec 16 6.11 Yr. Bhavesh Jain 27 Jun 14 8.61 Yr. Data below for Edelweiss Arbitrage Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 87.43% Debt 12.6% Equity Sector Allocation
Sector Value Financial Services 27.54% Basic Materials 11.14% Industrials 8.86% Consumer Cyclical 8.47% Energy 4.34% Health Care 3.86% Communication Services 3.61% Technology 2.93% Utility 2.67% Consumer Defensive 1.7% Real Estate 0.76% Debt Sector Allocation
Sector Value Cash Equivalent 84.65% Government 15.38% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity Future on Kotak Mahindra Bank Ltd
Derivatives | -4% -₹207 Cr 1,186,400
↑ 128,400 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Mar 21 | KOTAKBANK4% ₹205 Cr 1,186,400
↑ 128,400 Icici Bank Ltd.23/02/2023
Derivatives | -3% -₹180 Cr 2,144,100
↑ 2,144,100 ICICI Bank Ltd (Financial Services)
Equity, Since 30 Apr 20 | ICICIBANK3% ₹178 Cr 2,144,100
↑ 1,172,500 Future on Reliance Industries Ltd
Derivatives | -3% -₹159 Cr 670,250
↑ 122,500 Reliance Industries Ltd (Energy)
Equity, Since 30 Apr 18 | RELIANCE3% ₹158 Cr 670,250
↑ 122,500 6.69 6/27/2024 12:00:00 Am
Sovereign Bonds | -3% ₹149 Cr 15,000,000 7.16 5/20/2023 12:00:00 Am
Sovereign Bonds | -2% ₹125 Cr 12,500,000 Future on Ashok Leyland Ltd
Derivatives | -2% -₹117 Cr 7,760,000
↑ 105,000 Ashok Leyland Ltd (Industrials)
Equity, Since 31 May 21 | 5004772% ₹116 Cr 7,760,000
↑ 105,000 5. HDFC Arbitrage Fund
CAGR/Annualized return of 6.4% since its launch. Ranked 10 in Arbitrage category. Return for 2022 was 4.2% , 2021 was 3.6% and 2020 was 3.7% . HDFC Arbitrage Fund
Growth Launch Date 23 Oct 07 NAV (24 Mar 23) ₹26.084 ↑ 0.01 (0.05 %) Net Assets (Cr) ₹5,886 on 28 Feb 23 Category Hybrid - Arbitrage AMC HDFC Asset Management Company Limited Rating ☆☆☆ Risk Moderately Low Expense Ratio 0.92 Sharpe Ratio -1.39 Information Ratio 0 Alpha Ratio 0 Min Investment 100,000 Min SIP Investment 300 Exit Load 0-1 Months (0.25%),1 Months and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,557 29 Feb 20 ₹11,242 28 Feb 21 ₹11,560 28 Feb 22 ₹12,017 28 Feb 23 ₹12,566 Returns for HDFC Arbitrage Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.7% 6 Month 3.1% 1 Year 5% 3 Year 4.1% 5 Year 4.7% 10 Year 15 Year Since launch 6.4% Historical performance (Yearly) on absolute basis
Year Returns 2022 4.2% 2021 3.6% 2020 3.7% 2019 6% 2018 5.7% 2017 5.3% 2016 6.6% 2015 7.6% 2014 7.9% 2013 8.3% Fund Manager information for HDFC Arbitrage Fund
Name Since Tenure Anil Bamboli 1 Feb 22 1 Yr. Arun Agarwal 24 Aug 20 2.44 Yr. Priya Ranjan 1 May 22 0.75 Yr. Nirman Morakhia 15 Feb 23 0 Yr. Data below for HDFC Arbitrage Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 97.36% Debt 3.17% Equity Sector Allocation
Sector Value Financial Services 31.85% Basic Materials 8.87% Energy 6.61% Industrials 6.46% Consumer Cyclical 5.84% Utility 4.71% Consumer Defensive 2.73% Health Care 2.45% Communication Services 2.31% Real Estate 2.21% Technology 0.63% Debt Sector Allocation
Sector Value Cash Equivalent 90.21% Corporate 5.62% Government 4.7% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Money Market Dir Gr
Investment Fund | -12% ₹675 Cr 1,389,191 Future on Kotak Mahindra Bank Ltd
Derivatives | -8% -₹481 Cr Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Mar 22 | KOTAKBANK8% ₹478 Cr 2,762,000
↑ 1,421,600 HDFC Liquid Dir Gr
Investment Fund | -8% ₹472 Cr 1,079,998 Icici Bank Ltd.
Derivatives | -7% -₹402 Cr ICICI Bank Ltd (Financial Services)
Equity, Since 30 Apr 22 | ICICIBANK7% ₹398 Cr 4,788,000
↑ 3,201,100 Future on Reliance Industries Ltd
Derivatives | -6% -₹361 Cr Reliance Industries Ltd (Energy)
Equity, Since 31 Oct 21 | RELIANCE6% ₹358 Cr 1,519,250
↑ 931,750 Future on Adani Ports & Special Economic Zone Ltd
Derivatives | -4% -₹251 Cr Adani Ports & Special Economic Zone Ltd (Industrials)
Equity, Since 28 Feb 18 | ADANIPORTS4% ₹249 Cr 4,067,500
↓ -23,125 6. ICICI Prudential Equity Arbitrage Fund
CAGR/Annualized return of 6.8% since its launch. Ranked 4 in Arbitrage category. Return for 2022 was 4.2% , 2021 was 3.9% and 2020 was 4.3% . ICICI Prudential Equity Arbitrage Fund
Growth Launch Date 30 Dec 06 NAV (24 Mar 23) ₹29.2033 ↑ 0.01 (0.05 %) Net Assets (Cr) ₹11,273 on 28 Feb 23 Category Hybrid - Arbitrage AMC ICICI Prudential Asset Management Company Limited Rating ☆☆☆☆ Risk Moderate Expense Ratio 0.95 Sharpe Ratio -1.53 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 1,000 Exit Load 0-1 Months (0.25%),1 Months and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,607 29 Feb 20 ₹11,285 28 Feb 21 ₹11,667 28 Feb 22 ₹12,160 28 Feb 23 ₹12,707 Returns for ICICI Prudential Equity Arbitrage Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.7% 6 Month 3% 1 Year 5% 3 Year 4.3% 5 Year 4.9% 10 Year 15 Year Since launch 6.8% Historical performance (Yearly) on absolute basis
Year Returns 2022 4.2% 2021 3.9% 2020 4.3% 2019 5.9% 2018 6.2% 2017 5.5% 2016 6.8% 2015 7.6% 2014 8.6% 2013 9.8% Fund Manager information for ICICI Prudential Equity Arbitrage Fund
Name Since Tenure Kayzad Eghlim 1 Feb 11 12.01 Yr. Rohan Maru 29 Dec 20 2.09 Yr. Nikhil Kabra 29 Dec 20 2.09 Yr. Sharmila D’mello 31 Jul 22 0.5 Yr. Data below for ICICI Prudential Equity Arbitrage Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 93.79% Debt 6.71% Equity Sector Allocation
Sector Value Financial Services 21.47% Basic Materials 11.07% Industrials 6.85% Consumer Cyclical 5.95% Technology 5.58% Energy 5.03% Health Care 5.02% Consumer Defensive 3.16% Communication Services 2.99% Utility 1.86% Real Estate 1.43% Debt Sector Allocation
Sector Value Cash Equivalent 91.9% Government 6.86% Corporate 1.73% Securitized 0.01% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity ICICI Pru Savings Dir Gr
Investment Fund | -7% ₹751 Cr 16,474,508 Future on Reliance Industries Ltd
Derivatives | -4% -₹449 Cr 1,892,500 Reliance Industries Ltd (Energy)
Equity, Since 31 Aug 18 | RELIANCE4% ₹445 Cr 1,892,500 Icici Bank Ltd.
Derivatives | -4% -₹410 Cr 4,886,000
↑ 387,800 Future on HDFC Bank Ltd
Derivatives | -4% -₹407 Cr 1,870,300
↓ -287,750 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Oct 19 | ICICIBANK4% ₹406 Cr 4,886,000
↑ 387,800 Future on Kotak Mahindra Bank Ltd
Derivatives | -3% -₹331 Cr 1,899,600
↑ 1,132,400 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Oct 21 | KOTAKBANK3% ₹329 Cr 1,899,600
↑ 1,132,400 Future on Adani Ports & Special Economic Zone Ltd
Derivatives | -3% -₹318 Cr 5,153,750
↓ -3,750 Adani Ports & Special Economic Zone Ltd (Industrials)
Equity, Since 31 Aug 19 | ADANIPORTS3% ₹316 Cr 5,153,750
↓ -3,750 7. IDFC Arbitrage Fund
CAGR/Annualized return of 6.5% since its launch. Ranked 17 in Arbitrage category. Return for 2022 was 4.1% , 2021 was 3.5% and 2020 was 3.8% . IDFC Arbitrage Fund
Growth Launch Date 21 Dec 06 NAV (24 Mar 23) ₹27.6615 ↑ 0.02 (0.05 %) Net Assets (Cr) ₹3,630 on 28 Feb 23 Category Hybrid - Arbitrage AMC IDFC Asset Management Company Limited Rating ☆ Risk Moderately Low Expense Ratio 1.06 Sharpe Ratio -1.63 Information Ratio 0 Alpha Ratio 0 Min Investment 100 Min SIP Investment 1,000 Exit Load 0-1 Months (0.25%),1 Months and above(NIL) Growth of 10,000 investment over the years.
Date Value 28 Feb 18 ₹10,000 28 Feb 19 ₹10,610 29 Feb 20 ₹11,303 28 Feb 21 ₹11,629 28 Feb 22 ₹12,083 28 Feb 23 ₹12,619 Returns for IDFC Arbitrage Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23 Duration Returns 1 Month 0.5% 3 Month 1.7% 6 Month 3% 1 Year 4.9% 3 Year 4% 5 Year 4.8% 10 Year 15 Year Since launch 6.5% Historical performance (Yearly) on absolute basis
Year Returns 2022 4.1% 2021 3.5% 2020 3.8% 2019 6.2% 2018 6.3% 2017 5.5% 2016 6.3% 2015 7.4% 2014 8.5% 2013 9.2% Fund Manager information for IDFC Arbitrage Fund
Name Since Tenure Harshal Joshi 20 Oct 16 6.29 Yr. Nemish Sheth 26 Nov 21 1.18 Yr. Data below for IDFC Arbitrage Fund as on 28 Feb 23
Asset Allocation
Asset Class Value Cash 93.63% Debt 6.89% Equity Sector Allocation
Sector Value Financial Services 26.49% Consumer Cyclical 7.96% Industrials 7.55% Basic Materials 6.85% Real Estate 4.66% Energy 4.31% Health Care 4.29% Technology 3.34% Consumer Defensive 3.21% Communication Services 2.24% Utility 1.54% Debt Sector Allocation
Sector Value Cash Equivalent 88% Government 7.05% Corporate 4.86% Securitized 0.61% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity IDFC Cash Dir Gr
Investment Fund | -7% ₹256 Cr 953,178 Future on Kotak Mahindra Bank Ltd
Derivatives | -4% -₹148 Cr 852,000
↓ -170,800 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Oct 21 | KOTAKBANK4% ₹147 Cr 852,000
↓ -170,800 Future on Reliance Industries Ltd
Derivatives | -4% -₹145 Cr 612,500
↑ 508,500 Reliance Industries Ltd (Energy)
Equity, Since 31 Mar 18 | RELIANCE4% ₹144 Cr 612,500
↑ 508,500 Future on DLF Ltd
Derivatives | -3% -₹120 Cr 3,331,350
↑ 504,900 DLF Ltd (Real Estate)
Equity, Since 31 Aug 21 | 5328683% ₹119 Cr 3,331,350
↑ 504,900 Icici Bank Limited February 2023 Future
Derivatives | -3% -₹116 Cr 1,382,500
↑ 1,382,500 ICICI Bank Ltd (Financial Services)
Equity, Since 30 Jun 19 | ICICIBANK3% ₹115 Cr 1,382,500
↑ 324,100 Future on Adani Ports & Special Economic Zone Ltd
Derivatives | -3% -₹108 Cr 1,751,875
↑ 297,500
Things to Consider as an Investor
1. Risk
As trades are carried out on the stock exchange, there’s no counter party risk involved in these funds. Even though the fund manager is buying and selling shares in cash and futures market, there is no risk exposure to equities as is the case with other diversified equity mutual funds. Though the ride looks smooth, do not get too comfortable with these funds. As more people start trading into arbitrage funds, there will be not many arbitrage opportunities available. The spread between cash and future market prices will erode, leaving little for the arbitrage focused investors.
2. Return
Arbitrage Funds may be a good opportunity to make reasonable returns for those who can understand it and then make the most of it. The fund manager tries to generate an Alpha using price differentials in markets. Historically, arbitrage funds have been found to give returns in the Range of 7%-8% over a period of 5-10 years. If you are looking to earn moderate returns via a Portfolio which has a perfect blend of debt and equity in a volatile market, arbitrage funds may be your thing. However, you need to keep one thing in mind that there are no guaranteed returns in arbitrage funds.
3. Cost
Cost becomes an important consideration while evaluating arbitrage funds. These funds charge an annual fee called expense ratio which is expressed as a percentage of the fund’s assets. It includes fund manager’s fee and fund management charges. Due to frequent trading, arbitrage funds would incur huge transaction costs and has a high turnover ratio. Additionally, the fund may levy exit loads for a period of 30 to 60 days to discourage investors from exiting early. All these costs may lead to increase in the expense ratio of the fund. A high expense ratio puts a downward pressure on your take-home returns.
4. Investment Horizon
Arbitrage funds may be suitable for investors having a short to medium term horizon of 3 to 5 years. As these funds charge exit loads, you may consider them only when you are ready to stay invested for a period of at least 3-6 months. At the same time, you need to understand that fund returns are highly dependent on the existence of high volatility. So, choosing a lump sum investment would make sense over Systematic investment plan (SIPs). In absence of volatility, liquid funds may give better returns than arbitrage funds over the same investment horizon. Hence, you need to keep the overall market scenario in mind while choosing arbitrage funds.
5. Financial Goals
If you have short to medium term Financial goals, then arbitrage funds are your thing. Instead of a regular savings bank account, you may use these funds to park excess funds in order to create an emergency fund and earn higher returns on them. In case you were already invested in riskier havens equity funds, then you may begin a Systematic Transfer Plan (STP) from the equity funds to a less risky haven like arbitrage funds as you approach completion of the financial goal. This would reduce your portfolio’s overall risk profile but at the same time reduce the returns also. You cannot expect to earn double-digit returns in arbitrage funds.
How to Invest in Arbitrage Funds Online?
Open Free Investment Account for Lifetime at Fincash.com.
Complete your Registration and KYC Process
Upload Documents (PAN, Aadhaar, etc.). And, You are Ready to Invest!
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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