Fincash » Nippon India Arbitrage Fund Vs ICICI Prudential Equity Arbitrage Fund
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Nippon India Arbitrage Fund Vs ICICI Prudential Equity Arbitrage Fund
Nippon India Arbitrage Fund (Formerly known as Reliance Arbitrage Fund)and ICICI Prudential Equity Arbitrage Fund both belong to the arbitrage category of Hybrid Fund. Arbitrage funds are a type of Mutual Funds that leverage on the price differences of different markets to earn profits. Arbitrage Funds are named after the arbitrage strategy that they use. The returns of these funds are dependent on the volatility of the invested asset on the market. They make use of the market inefficiencies to generate returns for their investors. Though both Reliance/Nippon India Arbitrage Fund Vs ICICI Prudential Equity Arbitrage Fund belong to the same category there differ in some parameters like AUM, NAV, performances, etc. So, to make a better investment decision, let's have a look at both the schemes in a detailed manner.
Nippon India Arbitrage Fund (Formerly Reliance Arbitrage Fund)
Important Information: From October 2019, Reliance Mutual Fund has been renamed as Nippon India Mutual Fund. Nippon Life has acquired majority (75%) stakes in Reliance Nippon Asset Management (RNAM). The company will continue to run its operations without any change in structure and management.
Nippon India Arbitrage Advantage Fund was launched in the year 2010. The fund seeks to generate income by taking advantage of the arbitrage opportunities that potentially exists between cash and derivative market. As the fund also invests in debt and money market securities, it profits from regular income.
Some of the top holdings of Reliance/Nippon Arbitrage Fund as on 30th June 2018 are Cash Offset For Derivatives, HDFC Bank Ltd, Housing Development Finance Corp Ltd, Axis Bank Ltd, ICICI Bank Ltd. etc.
ICICI Prudential Equity Arbitrage Fund
ICICI Prudential Equity Arbitrage Fund was launched in the year 2006. The aim of the fund is to generate low volatility returns by using arbitrage and other derivative strategies in equity markets and investments in short-term debt portfolio.
Some of the top holdings of the fund as on 30th June 2018 are Cash Offset For Derivatives, Housing Development Finance Corp Ltd, Sun Pharmaceuticals Industries Ltd, Housing Development Finance Corporation Limited, etc.
Nippon India Arbitrage Fund Vs ICICI Prudential Equity Arbitrage Fund
Both Nippon India Arbitrage Fund Vs ICICI Prudential Equity Arbitrage Fund belong to the same category of arbitrage fund. However, there are numerous differences between them. So, let us analyze the differences between both the schemes on the basis of four sections given below.
Basics Section
Being the first section, it compares parameters such as current NAV, AUM, scheme category, Fincash Rating, and many more. With respect the sub category, both the scheme belong to Arbitrage Category
Based on Fincash Rating, it can be said that both the funds are rated as 4-Star.
The summary of the basics section is tabulated as follows.
Parameters Basics NAV Net Assets (Cr) Launch Date Rating Category Sub Cat. Category Rank Risk Expense Ratio Sharpe Ratio Information Ratio Alpha Ratio Benchmark Exit Load Nippon India Arbitrage Fund
Growth
Fund Details ₹19.8846 ↑ 0.01 (0.04 %) ₹10,528 on 31 Dec 19 14 Oct 10 ☆☆☆☆ Hybrid Arbitrage 3 Moderately Low 1.05 4.28 0 0 Not Available 0-1 Months (0.25%),1 Months and above(NIL) ICICI Prudential Equity Arbitrage Fund
Growth
Fund Details ₹25.604 ↑ 0.01 (0.03 %) ₹13,566 on 31 Dec 19 30 Dec 06 ☆☆☆☆ Hybrid Arbitrage 4 Moderate 0.95 3.85 0 0 Not Available 0-1 Months (0.25%),1 Months and above(NIL)
Performance Section
Compounded Annual Growth Rate or CAGR returns is the comparable parameter forming part of the basics section. The CAGR returns are compared at different time intervals such as 1 Month Return, 6 Month Return, 3 Year Return, and Return since Inception. The comparison of performance section shows that Reliance Arbitrage Fund has performed better than ICICI Prudential Equity Arbitrage Fund. The table given below summarizes the comparison of the performance section.
Parameters Performance 1 Month 3 Month 6 Month 1 Year 3 Year 5 Year Since launch Nippon India Arbitrage Fund
Growth
Fund Details 0.5% 1.2% 2.6% 6.2% 6.2% 6.6% 7.7% ICICI Prudential Equity Arbitrage Fund
Growth
Fund Details 0.5% 1.3% 2.6% 6.1% 6% 6.4% 7.5%
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Yearly Performance Section
The comparison of the absolute returns for a particular year earned by both the schemes is done in the yearly performance section. The comparison of absolute returns states that both the funds have n performed closely. The table given below shows the summary comparison of the absolute returns section.
Parameters Yearly Performance 2018 2017 2016 2015 2014 Nippon India Arbitrage Fund
Growth
Fund Details 6.2% 6.8% 5.5% 6.6% 8.1% ICICI Prudential Equity Arbitrage Fund
Growth
Fund Details 5.9% 6.2% 5.5% 6.8% 7.6%
Other Details Section
Being the last section in the comparison, it includes parameters such as minimum SIP investment and minimum lumpsum investment. The minimum lump sum investment for both the schemes is same, that is, INR 5,000. However, the minimum SIP investment is different for both the schemes. The SIP amount in case of ICICI Prudential Equity Arbitrage Fund is INR 1,000 and of Reliance Arbitrage Fund is INR 100.
ICICI Prudential Equity Arbitrage Fund is jointly managed by Kayzad Eghlim and Manish Banthia.
The fund is currently managed jointly by Payal Kaipunjal and Kinjal Desai.
The summary comparison of the other details section is tabulated as follows.
Parameters Other Details Min SIP Investment Min Investment Fund Manager Nippon India Arbitrage Fund
Growth
Fund Details ₹100 ₹5,000 Kinjal Desai - 1.35 Yr. ICICI Prudential Equity Arbitrage Fund
Growth
Fund Details ₹1,000 ₹5,000 Kayzad Eghlim - 8.92 Yr.
Growth of 10k Investments over the years
Nippon India Arbitrage Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,805 31 Dec 16 ₹11,517 31 Dec 17 ₹12,146 31 Dec 18 ₹12,969 31 Dec 19 ₹13,768 ICICI Prudential Equity Arbitrage Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,756 31 Dec 16 ₹11,487 31 Dec 17 ₹12,118 31 Dec 18 ₹12,872 31 Dec 19 ₹13,635
Detailed Portfolio Comparison
Nippon India Arbitrage Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 94.81% Debt 4.3% Other 1.18% Equity Sector Allocation
Sector Value Financial Services 16.65% Basic Materials 9.51% Technology 8.54% Health Care 7.48% Consumer Cyclical 7.22% Consumer Defensive 6.34% Energy 5.08% Industrials 3.54% Utility 1.9% Communication Services 1.54% Real Estate 0.13% Debt Sector Allocation
Sector Value Cash Equivalent 93.21% Corporate 4.93% Government 0.97% Credit Quality
Rating Value AA 12.75% AAA 87.25% Top Securities Holdings / Portfolio
Name Holding Value Quantity Cash Offset For Derivatives
Derivative Margin | -68% ₹6,975 Cr 697,512
↑ 50,411 Hdfc Bank Limited
Certificate of Deposit | -10% ₹1,050 Cr Triparty Repo
CBLO/Reverse Repo | -6% ₹592 Cr Future on Tata Consultancy Services Ltd
Derivatives | -5% -₹549 Cr 2,662,000
↑ 2,662,000 Tata Consultancy Services Ltd (Technology)
Equity, Since 30 Sep 18 | TCS5% ₹547 Cr 2,662,000
↑ 883,250 Future on Sun Pharmaceuticals Industries Ltd
Derivatives | -5% -₹460 Cr 10,179,400
↑ 10,179,400 Sun Pharmaceuticals Industries Ltd (Healthcare)
Equity, Since 30 Apr 15 | SUNPHARMA4% ₹458 Cr 10,179,400
↑ 896,500 Axis Bank Limited
Certificate of Deposit | -4% ₹375 Cr Future on Housing Development Finance Corp Ltd
Derivatives | -3% -₹356 Cr 1,544,000
↑ 1,544,000 Housing Development Finance Corp Ltd (Financial Services)
Equity, Since 31 Jan 18 | HDFC3% ₹355 Cr 1,544,000
↓ -1,114,500 ICICI Prudential Equity Arbitrage Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 93.94% Debt 5.47% Other 0.86% Equity Sector Allocation
Sector Value Financial Services 22.86% Technology 7.82% Energy 7.68% Basic Materials 7.11% Health Care 5.8% Consumer Defensive 5.21% Consumer Cyclical 3.68% Industrials 3.19% Utility 1.65% Communication Services 1.04% Real Estate 0.13% Debt Sector Allocation
Sector Value Cash Equivalent 87.57% Corporate 8.07% Government 3.78% Credit Quality
Rating Value AA 4.83% AAA 95.17% Top Securities Holdings / Portfolio
Name Holding Value Quantity Cash Offset For Derivatives
Derivative Margin | -66% ₹9,317 Cr 931,655
↑ 62,220 Future on HDFC Bank Ltd
Derivatives | -12% -₹1,635 Cr 8,869,250
↑ 8,869,250 Housing Development Finance Corp Ltd (Financial Services)
Equity, Since 31 Oct 16 | HDFC8% ₹1,117 Cr 4,864,250
↑ 38,250 Future on Reliance Industries Ltd
Derivatives | -7% -₹920 Cr 5,898,500
↑ 5,898,500 Reliance Industries Ltd (Energy)
Equity, Since 31 Aug 18 | RELIANCE7% ₹915 Cr 5,898,500
↑ 56,000 Future on Infosys Ltd
Derivatives | -4% -₹516 Cr 7,383,600
↑ 7,383,600 Infosys Ltd (Technology)
Equity, Since 31 Jul 18 | INFY4% ₹514 Cr 7,383,600
↓ -177,600 HDFC Bank Ltd (Financial Services)
Equity, Since 30 Apr 19 | HDFCBANK4% ₹511 Cr 4,005,000
↓ -1,425,500 Treps
CBLO/Reverse Repo | -3% ₹425 Cr Future on State Bank of India
Derivatives | -3% -₹420 Cr 12,234,000
↑ 12,234,000
As a result, from the above-mentioned pointers, it can be said that both the schemes differ on account of numerous parameters. Therefore, individuals should pay extra caution before Investing in any of the schemes. They should check whether the scheme matches their investment objective or not and understand its modalities completely. This will help them to achieve their goals on time along with ensuring their investment is safe.
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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