IDFC Asset Management Company Ltd. is one of the biggest fund houses in India (in terms of Assets Under Management) and was established in the year 2000. IDFC Financial Holding Company Ltd. wholly owns the IDFC AMC and is the sponsor of IDFC Mutual Fund. IDFC Ltd. was established in 1997 by the Government of India as a catalyst and financier for the involvement of the private sector in the development of infrastructure in India. IDFC Mutual Fund offers schemes across various asset classes - equity, debt, and hybrid.
IDFC Dynamic Bond Fund-Direct Plan-Dividend is an open-ended dynamic debt scheme that invests in debt and money market securities across maturities. The direct plan offers a lower expense ratio to the investors and the dividend option entitles investors to receive regular income.
Investment objective
To produce optimal returns through active management of a portfolio consisting of debt and money market securities.
Key Features of the scheme
The IDFC Dynamic Bond Fund is ideal for investors who wish to grow their capital by investing in debt securities and exhibits the below-given features:
| Type of fund | An open-ended dynamic debt scheme |
| Plans available | Growth and Dividend |
| Options under each plan | Under the Dividend option, the scheme offers Dividend Payout and Dividend Reinvestment option |
| Risk | Moderate |
| Systematic Investment Plan | Available |
| Systematic Transfer Plan | Available |
| Systematic Withdrawal Plan | Available |
Investment amount for IDFC Dynamic Bond Fund
| Minimum Application Amount | Rs.5,000 and any amount thereafter |
| Minimum Additional Investment | Rs.1,000 and any amount thereafter |
| Minimum installment for Systematic Investment Plan (SIP) | Rs.1,000 and in multiples of Re.1 thereafter (a minimum of 6 instalments) |
| Minimum installment for Systematic Withdrawal Plan (SWP) | Rs.500 and in multiples of Re.1 thereafter |
| Entry Load | Nil |
| Exit Load | Nil |
Asset Allocation for IDFC Dynamic Bond Fund
| Asset Class | Indicative allocation (%age of total assets) |
| Debt securities including securitised debt and government securities, money market securities across maturities | 0% to 100% |
| Units issued by REITs and InvITs | 10% |
Who can invest in IDFC Dynamic Bond Fund?
The below-mentioned persons/entities are eligible to invest in the units of IDFC Dynamic Bond Fund:
- Adults residing in India, either singly or jointly (not more than 3 individuals)
- Parents/Legal Guardians on minor's behalf
- Corporate bodies and firms registered in India
- Co-operative and registered societies authorised to invest
- Hindu Undivided Families (HUFs) through Karta
- Body of Individuals (BoI) or Association of Persons (AoP)
- Financial Institutions, Investment Institutions, and banks (including Regional Rural Banks and Co-operative Banks)
- Public corporations and public sector undertakings (PSUs)
- Religious and charitable trusts
- Trustees of private trusts authorised under their trust deeds
- Partners of partnership firms
- Government of India approved International Multilateral Agencies
- Navy/Army/Air Force, Para-Military Units and other eligible institutions
- Scientific and Industrial Research Organisations
- SEBI registered mutual funds
- Non-Resident Indians (NRIs) and Persons of Indian Origin on repatriation or non-repatriation basis
- Foreign Portfolio investors and Public Financial Institutions
- Foreign Institutional Investors (FIIs) registered with SEBI
- Universities and Educational Institutions
NAV Disclosure and Benchmark for IDFC Dynamic Bond Fund
The Net Asset Value (NAV) of the scheme is calculated by dividing the scheme’s net assets by the number of units that are outstanding on the date of valuation. The scheme’s NAV is computed up to 4 decimals and is announced at the end of every business day. The NAV will be published on the website of the AMFI (www.amfiindia.com) by 9:00 p.m. on all business days.
The official website of IDFC Mutual Fund (www.idfcmf.com) will also display the NAV of the scheme and send it for publication in at least 2 newspapers with countrywide circulation on every business day.
Liquidity: Being an open-ended scheme, purchases and redemptions can be done on any business day at the applicable NAV.
Benchmark Index: CRISIL Composite Bond Fund Index
Fund Manager
Mr. Suyash Choudhary
The IDFC Dynamic Bond Fund is managed by Mr. Suyash Choudhary since 15 October 2010. Mr. Choudhary has over 17 years of experience in managing fixed income investments. Prior to joining IDFC Mutual Fund, he had worked with HSBC Asset Management Pvt. Ltd. and Standard Chartered Asset Management Co. Pvt. Ltd. The other funds managed by him include IDFC Bond Fund, IDFC Government Securities Fund, and IDFC Hybrid Equity Fund.
Investment Restrictions on IDFC Dynamic Bond Fund
The Securities and Exchange Board of India (SEBI) has laid down the following investment restrictions for subscription to the units of the IDFC Dynamic Bond Fund:
- The scheme is not allowed to invest above 10% of its NAV in debt securities issued by a single issuer and rated above the investment grade by a credit rating agency. This limit can be extended to 12% of the NAV provided that the Trust and Board of the AMC approve it.
- The scheme is not permitted to invest above 10% of its NAV in debt instruments that are unrated and issued by a single issuer. The total investment in such securities also cannot be more than 25% of the scheme’s NAV. Any such investments will need to be approved by the Board and Trustee of the AMC.
- The scheme shall not make any investments in any security issued through private placement, unlisted securities, and listed securities of group companies of the sponsors above 25% of the net assets.
- Debentures of any residual maturity period will attract the same restrictions as debt securities including the ones issued by public institutions/bodies such as municipal corporations, electricity boards, state transport corporations, etc. The restrictions however, will not apply to securities issued by central or state governments.
- The mutual fund can enter into transactions dealing with government securities only in the dematerialised form.
- The scheme is not permitted to invest in any Fund of Funds (FoF) schemes.
- The scheme cannot advance loans for any purpose or borrow except to meet the scheme’s temporary liquidity needs. The borrowing however, cannot exceed 6 months and should not be above 20% of the scheme’s net assets.
- The scheme can invest the pending deployment of a scheme’s funds in short-term deposits of scheduled commercial banks without being charged any advisory or investment management fees.
Dividend Policy of IDFC Dynamic Bond Fund
Investors will be entitled to receive dividends that will be distributed at the discretion of the Trustee and on the availability of surplus by way of realised profit. To be eligible for receiving dividends, the name of the investors should appear on the register of unitholders.
The dividend option will be available under 2 options - payout and reinvestment option. In the payout option, unitholders will receive payouts which they can encash through direct credit or any other means into their bank account.
Investors opting for a dividend reinvestment will not receive payouts but the dividend will be invested back into the scheme allowing investors to buy additional units of the scheme. When the dividends are reinvested, the number of units to the credit of the unitholder will increase at the same extent as the dividend reinvested divided by the applicable NAV.
If the investor does not select any frequency under the dividend option, ‘Quarterly Dividend Reinvestment’ will be the default frequency. To receive dividends, unitholders should select the ‘dividend’ option in the application form.
Other Facilities offered under IDFC Dynamic Bond Fund
The IDFC Dynamic Bond Fund offers the below facilities for the benefit of investors:
- Systematic Investment Plan (SIP)
- Systematic Withdrawal Plan (SWP)
- Systematic Transfer Plan (STP)
Why you should invest in IDFC Dynamic Bond Fund
- Actively managed fund - The IDFC Dynamic Bond Fund is actively managed which means that the fund manager has the authority to make decisions about how to invest the capital. The fund manager of this scheme is Mr. Suyash Choudhary who has over 17 years of experience in managing decisions. Therefore, you can be assured that your investments are taken care of prudently.
- Low investment amount - Investing in the units of the scheme can be done for as low as Rs.1,000 a month through an SIP. So, you need to wait to accumulate a lump-sum amount to make an investment. Investing through an SIP also lets you cultivate the habit of regular investing.
- Low risk - Since the IDFC Dynamic Bond Fund invests in debt securities, it offers low risk to the investors and is therefore, ideal for investors who have a low appetite for risk.
- Optimal returns - The IDFC Bond Fund generates most favourable returns on your investment by investing in a mix of debt and money market securities.
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