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Top 4 Best Floating Rate Funds to Invest in 2020
Floating Rate Funds are a type of Debt fund that mainly invests in floating rate instruments. Here the interest paid changes in order with the changing interest rate scenario in the debt market. As per Security and Exchange Board of India (SBEI) norms, Floater Fund should invest a minimum of 65 percent of its total assets in the floating rate instrument. One of the biggest advantages of this fund is its lowest degree of sensitivity to changes in interest rates. So, let’s look at some of the best performing floater funds to invest in 2020.
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What are Floating Rate Funds?
The floating rate instrument is considered to be an attractive instrument for investors with a conservative portion. This fund invests a major portion of its corpus in floating rate instruments and rest in fixed income securities. These funds are least risky in terms of interest rate. Unlike other debt funds, floating rate funds do not react to the changing interest rates. When the Government of India issues bond in the market, they have a fixed coupon rate, whereas, floating rate securities have variable interest rates. These floating rate interest increases or decreases based on the reference rate. To benefit the most, one should invest in these funds when interest rates are expected to rise.
But, being a debt fund, the credit risk in the fund still remains. Credit risk arises when a company that has issued the debt instruments does not make regular payments. In such cases, it has a major impact on the fund, depending on how much portion the fund has in the portfolio. Hence, it is suggested to be in debt instruments with a rating higher credit rating.
There are two kinds of floating rate funds— short-term and long-term. The portfolio of short-term floating funds is normally skewed towards short-term maturities and the portfolio of the long-term plan is skewed towards longer-term maturities.
Best Floating Rate Funds 2020
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 2018 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity Aditya Birla Sun Life Floating Rate Fund - Long Term Growth ₹245.394
↑ 0.08 ₹8,715 1.8 4 8.6 7.6 8.6 6.23% 11M 1D 1Y 29D Nippon India Floating Rate Fund Growth ₹31.2423
↑ 0.01 ₹6,308 1.9 4 8.8 6.9 9 6.82% 8M 5D 8M 26D ICICI Prudential Floating Interest Fund Growth ₹297.342
↑ 0.14 ₹8,005 2 4.2 8.5 7.2 8.4 7.87% 1Y 22D 1Y 3M 22D PGIM India Floating Rate Fund Growth ₹10.8156
↑ 0.00 ₹13 -47.2 -46.2 -44.4 -14 15.04% 1M 6D 1M 13D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 24 Jan 20
The primary objective of the schemes is to generate regular income through investment in a portfolio comprising substantially of floating rate debt / money market instruments. The schemes may invest a portion of its net assets in fixed rate debt securities and money market instruments. Aditya Birla Sun Life Floating Rate Fund - Long Term is a Debt - Floating Rate fund was launched on 25 Mar 09. It is a fund with Moderately Low risk and has given a Below is the key information for Aditya Birla Sun Life Floating Rate Fund - Long Term Returns up to 1 year are on (Erstwhile Reliance Floating Rate Fund - Short Term Plan) The primary objective of the scheme is to generate regular income through investment in a portfolio comprising substantially of Floating Rate Debt Securities (including floating rate securitized debt, Money Market Instruments and Fixed Rate Debt Instruments swapped for floating rate returns). The scheme shall also invest in Fixed rate Debt Securities (including fixed rate Securitized Debt, Money Market Instruments and Floating Rate Debt Instruments swapped for fixed returns). Nippon India Floating Rate Fund is a Debt - Floating Rate fund was launched on 27 Aug 04. It is a fund with Moderately Low risk and has given a Below is the key information for Nippon India Floating Rate Fund Returns up to 1 year are on (Erstwhile ICICI Prudential Savings Fund) The scheme aims to generate income consistent with the prudent risk from a portfolio comprising floating rate debt instruments, fixed rate debt instruments swapped for floating rate return, and also fixed rate instruments & money market instruments. ICICI Prudential Floating Interest Fund is a Debt - Floating Rate fund was launched on 18 Nov 05. It is a fund with Moderate risk and has given a Below is the key information for ICICI Prudential Floating Interest Fund Returns up to 1 year are on (Erstwhile DHFL Pramerica Short Term Floating Rate Fund) The objective of the scheme is to generate regular income through investment in a portfolio comprising primarily in short maturity floating rate debt/money market instruments. However, there is no assurance that the investment objective of the Scheme will be realized and the Scheme does not assure or
guarantee any returns. PGIM India Floating Rate Fund is a Debt - Floating Rate fund was launched on 26 Mar 10. It is a fund with Moderately Low risk and has given a Below is the key information for PGIM India Floating Rate Fund Returns up to 1 year are on 1. Aditya Birla Sun Life Floating Rate Fund - Long Term
CAGR/Annualized return of 8.6% since its launch. Ranked 14 in Floating Rate category. Return for 2019 was 8.6% , 2018 was 7.5% and 2017 was 6.9% . Aditya Birla Sun Life Floating Rate Fund - Long Term
Growth Launch Date 25 Mar 09 NAV (24 Jan 20) ₹245.394 ↑ 0.08 (0.03 %) Net Assets (Cr) ₹8,715 on 31 Dec 19 Category Debt - Floating Rate AMC Birla Sun Life Asset Management Co Ltd Rating ☆☆☆☆ Risk Moderately Low Expense Ratio 0.39 Sharpe Ratio 5.7 Information Ratio 0.9 Alpha Ratio -1.6 Min Investment 1,000 Min SIP Investment 1,000 Exit Load NIL Yield to Maturity 6.23% Effective Maturity 1 Year 29 Days Modified Duration 11 Months 1 Day Growth of 10,000 investment over the years.
Date Value Returns for Aditya Birla Sun Life Floating Rate Fund - Long Term
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Jan 20 Duration Returns 1 Month 0.7% 3 Month 1.8% 6 Month 4% 1 Year 8.6% 3 Year 7.6% 5 Year 8.3% 10 Year 15 Year Since launch 8.6% Historical performance (Yearly) on absolute basis
Year Returns 2018 8.6% 2017 7.5% 2016 6.9% 2015 9.5% 2014 8.9% 2013 9.6% 2012 9.6% 2011 10.1% 2010 9.4% 2009 6.5% Fund Manager information for Aditya Birla Sun Life Floating Rate Fund - Long Term
Name Since Tenure Kaustubh Gupta 15 Jul 11 8.3 Yr. Data below for Aditya Birla Sun Life Floating Rate Fund - Long Term as on 31 Dec 19
Asset Allocation
Asset Class Value Cash 37.97% Debt 62.03% Debt Sector Allocation
Sector Value Corporate 46.55% Government 34.07% Cash Equivalent 18.64% Securitized 0.74% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity Clearing Corporation Of India Limited
CBLO | -14% ₹1,272 Cr 7.80% GOI Floating Rate Bonds 2020
Sovereign Bonds | -3% ₹314 Cr 31,500,000
↑ 31,500,000 REC LIMITED
Debentures | -3% ₹277 Cr 2,710
↑ 750 AXIS BANK LIMITED
Certificate of Deposit | -3% ₹250 Cr 25,000
↑ 25,000 Net Receivables / (Payables)
Net Current Assets | -2% -₹200 Cr BAJAJ FINANCE LIMITED
Commercial Paper | -2% ₹193 Cr 4,000
↑ 4,000 NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT
Debentures | -2% ₹179 Cr 1,700 LIC HOUSING FINANCE LIMITED
Debentures | -2% ₹179 Cr 1,750
↑ 1,250 GOVT STOCK
Sovereign Bonds | -2% ₹177 Cr 17,500,000 SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA
Certificate of Deposit | -2% ₹171 Cr 17,500 2. Nippon India Floating Rate Fund
CAGR/Annualized return of 7.7% since its launch. Ranked 32 in Floating Rate category. Return for 2019 was 9% , 2018 was 5.8% and 2017 was 5.9% . Nippon India Floating Rate Fund
Growth Launch Date 27 Aug 04 NAV (24 Jan 20) ₹31.2423 ↑ 0.01 (0.05 %) Net Assets (Cr) ₹6,308 on 31 Dec 19 Category Debt - Floating Rate AMC Nippon Life Asset Management Ltd. Rating ☆☆☆ Risk Moderately Low Expense Ratio 0.6 Sharpe Ratio 5.04 Information Ratio -1.01 Alpha Ratio 1.2 Min Investment 5,000 Min SIP Investment 100 Exit Load 0-1 Months (0.5%),1 Months and above(NIL) Yield to Maturity 6.82% Effective Maturity 8 Months 26 Days Modified Duration 8 Months 5 Days Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,863 31 Dec 16 ₹11,845 31 Dec 17 ₹12,549 31 Dec 18 ₹13,282 31 Dec 19 ₹14,480 Returns for Nippon India Floating Rate Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Jan 20 Duration Returns 1 Month 0.6% 3 Month 1.9% 6 Month 4% 1 Year 8.8% 3 Year 6.9% 5 Year 7.6% 10 Year 15 Year Since launch 7.7% Historical performance (Yearly) on absolute basis
Year Returns 2018 9% 2017 5.8% 2016 5.9% 2015 9% 2014 8.6% 2013 9.8% 2012 7.9% 2011 9.7% 2010 9.2% 2009 5.4% Fund Manager information for Nippon India Floating Rate Fund
Name Since Tenure Amit Tripathi 7 Oct 07 12.16 Yr. Vivek Sharma 1 Oct 13 6.17 Yr. Kinjal Desai 25 May 18 1.52 Yr. Data below for Nippon India Floating Rate Fund as on 31 Dec 19
Asset Allocation
Asset Class Value Cash 21.57% Debt 78.42% Other 0% Debt Sector Allocation
Sector Value Corporate 63.47% Cash Equivalent 16.71% Government 16.02% Securitized 3.81% Credit Quality
Rating Value AA 4.2% AAA 95.8% Top Securities Holdings / Portfolio
Name Holding Value Quantity Citibank N.A.
Certificate of Deposit | -7% ₹425 Cr Tata Sons Limited
Debentures | -6% ₹377 Cr 3,750 Nabha Power Limited
Debentures | -6% ₹352 Cr 3,500 Net Current Assets
Net Current Assets | -6% ₹333 Cr Mahindra & Mahindra Financial Services Ltd
Debentures | -5% ₹303 Cr 3,000 Reliance Ports And Terminals Limited
Debentures | -5% ₹280 Cr 2,689 India Grid Trust
Unlisted bonds | -4% ₹252 Cr 2,500 Rural Electrification Corporation Limited
Debentures | -4% ₹234 Cr 2,301
↑ 400 LIC Housing Finance Limited
Debentures | -4% ₹234 Cr 2,290 HDB Financial Services Limited
Debentures | -4% ₹232 Cr 2,350 3. ICICI Prudential Floating Interest Fund
CAGR/Annualized return of 8% since its launch. Ranked 35 in Floating Rate category. Return for 2019 was 8.4% , 2018 was 6.6% and 2017 was 6.8% . ICICI Prudential Floating Interest Fund
Growth Launch Date 18 Nov 05 NAV (24 Jan 20) ₹297.342 ↑ 0.14 (0.05 %) Net Assets (Cr) ₹8,005 on 31 Dec 19 Category Debt - Floating Rate AMC ICICI Prudential Asset Management Company Limited Rating ☆☆☆ Risk Moderate Expense Ratio 1.31 Sharpe Ratio 5.55 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 100 Exit Load NIL Yield to Maturity 7.87% Effective Maturity 1 Year 3 Months 22 Days Modified Duration 1 Year 22 Days Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,808 31 Dec 16 ₹11,768 31 Dec 17 ₹12,563 31 Dec 18 ₹13,394 31 Dec 19 ₹14,522 Returns for ICICI Prudential Floating Interest Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Jan 20 Duration Returns 1 Month 0.7% 3 Month 2% 6 Month 4.2% 1 Year 8.5% 3 Year 7.2% 5 Year 7.7% 10 Year 15 Year Since launch 8% Historical performance (Yearly) on absolute basis
Year Returns 2018 8.4% 2017 6.6% 2016 6.8% 2015 8.9% 2014 8.1% 2013 9.2% 2012 9.2% 2011 9.7% 2010 9.1% 2009 5.6% Fund Manager information for ICICI Prudential Floating Interest Fund
Name Since Tenure Rahul Goswami 27 Sep 12 7.18 Yr. Nikhil Kabra 3 Aug 16 3.33 Yr. Data below for ICICI Prudential Floating Interest Fund as on 31 Dec 19
Asset Allocation
Asset Class Value Cash 18.71% Debt 81.29% Debt Sector Allocation
Sector Value Corporate 77.14% Cash Equivalent 12.26% Government 10.6% Credit Quality
Rating Value A 3.79% AA 48.59% AAA 47.63% Top Securities Holdings / Portfolio
Name Holding Value Quantity Bahadur Chand Investments Private Limited
Debentures | -5% ₹368 Cr 369 Bharti Airtel Limited
Debentures | -4% ₹349 Cr 3,500 Net Current Assets
Net Current Assets | -4% ₹320 Cr EMBASSY OFFICE PARKS REIT
Debentures | -4% ₹318 Cr 3,000 State Bank Of India
Debentures | -3% ₹260 Cr 2,500 Vedanta Limited
Debentures | -3% ₹248 Cr 2,500 POWER FINANCE CORPORATION LIMITED
Debentures | -3% ₹229 Cr 2,250 GOVT STOCK
Sovereign Bonds | -2% ₹187 Cr 18,000,000
↑ 8,000,000 United Spirits Limited
Debentures | -2% ₹179 Cr 1,800 Treps
CBLO/Reverse Repo | -2% ₹174 Cr 4. PGIM India Floating Rate Fund
CAGR/Annualized return of 0.5% since its launch. Ranked 42 in Floating Rate category. . PGIM India Floating Rate Fund
Growth Launch Date 26 Mar 10 NAV (22 Jun 19) ₹10.8156 ↑ 0.00 (0.01 %) Net Assets (Cr) ₹13 on 30 Apr 19 Category Debt - Floating Rate AMC Pramerica Asset Managers Private Limited Rating ☆☆☆ Risk Moderately Low Expense Ratio 0.51 Sharpe Ratio 3.6 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 500 Exit Load NIL Yield to Maturity 15.04% Effective Maturity 1 Month 13 Days Modified Duration 1 Month 6 Days Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,824 31 Dec 16 ₹11,724 31 Dec 17 ₹12,521 31 Dec 18 ₹13,368 PGIM India Floating Rate Fund SIP Returns
Returns for PGIM India Floating Rate Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Jan 20 Duration Returns 1 Month -48.1% 3 Month -47.2% 6 Month -46.2% 1 Year -44.4% 3 Year -14% 5 Year -5.6% 10 Year 15 Year Since launch 0.5% Historical performance (Yearly) on absolute basis
Year Returns 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 Fund Manager information for PGIM India Floating Rate Fund
Name Since Tenure Data below for PGIM India Floating Rate Fund as on 30 Apr 19
Asset Allocation
Asset Class Value Debt Sector Allocation
Sector Value Credit Quality
Rating Value Top Securities Holdings / Portfolio
Name Holding Value Quantity
Advantages of Floating Rate Funds
Some of the benefits of Floating Rate Funds are:
- Price Stability- As floating rate funds are tied to current rates; the price of the underlying securities doesn’t fluctuate in response to changes in the interest rates.
- Better Yield- Floating funds tend to offer better yields than those of Certificate of Deposits (CDs). This can be a better idea for those who want to earn returns in a short duration.
- Moderate Risk- Debt funds are anytime less risky than Equity Funds. When it comes to floater funds these are less risky than other debt funds, as they don’t carry interest rate risk. However, diversification of the portfolio significantly reduces the risk of the portfolio.
How to Select Best Floating Rate Funds?
Some of the ideal ways to choose best floating rate funds are:
- Look at the past performances of the fund, typically of past 1-3 years. The fund with the most stable and consistent performance is the one to go with
- Ideally, one should go with the fund that has an Asset Under Management (AUM) > INR 100 Cr
- Invest in funds that invests in high credit-rating companies
How to Invest in Floating Rate 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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