IDFC Asset Management Co. Ltd. was set up in the year 2000 and is one of the best fund houses in India. It has a wide network and has its presence in several cities like Ahmedabad, Chennai, Bengaluru, Dehradun, Jaipur, Kolkata, Mumbai, Pune, and so on. The AMC offers various fund types like equity funds, debt funds, tax-saving funds, index funds, fund of funds, infrastructure funds, low-risk funds, etc. The IDFC Dynamic Bond Fund is one of the many schemes available under the debt schemes category.
The IDFC Dynamic Bond Fund – Regular – Growth scheme ensures the growth of capital over a long term and does not provide any returns on a short-term basis. The investments will be invested and reinvested until they are redeemed at the end of the term. The Growth plan further has two options – regular and direct. While individuals can make investments directly through the direct option, they are aided by mutual fund brokers and distributors to make investments through the regular option.
Investment Objective of IDFC Dynamic Bond Fund - Regular - Growth
The objective of the scheme is to provide the investors with good returns by actively managing the scheme and making investments in debt securities and money market instruments.
Key Features of IDFC Dynamic Bond Fund - Regular - Growth
The basic features of the IDFC Dynamic Bond Fund – Regular – Growth scheme are:
|Type of fund||Open-ended dynamic debt scheme|
|Options under each plan||
|Systematic Investment Plan||Available|
|Systematic Transfer Plan||Available|
|Systematic Withdrawal Plan||Available|
Investment Amount for IDFC Dynamic Bond Fund - Regular - Growth
The limitations on the investment amounts are given below:
|Minimum application amount||Rs.5,000|
|Minimum additional investment||Rs.1,000|
|Minimum installment for Systematic Investment Plan (SIP)||Rs.1,000|
|Minimum installment for Systematic Withdrawal Plan (SWP)||Rs.500|
|Minimum installment for Systematic Transfer Plan (STP)||Rs.1,000|
Unitholders are required to maintain a minimum balance of Rs.500.
Asset Allocation for IDFC Dynamic Bond Fund - Regular - Growth
The allocations for each of the instruments the scheme invests in are as mentioned below:
|Instruments||Allocations (Percentage of total assets)|
|Debt securities and money market instruments||0% - 100%|
|Units issued by Real Estate Investment Trusts and Infrastructure Investment Trust||10%|
Who can invest in IDFC Dynamic Bond Fund - Regular - Growth
The below-mentioned individuals and bodies are permitted to invest in the scheme:
- Hindu Undivided Family
- Resident Indian individuals – single and joint holding options available (number of joint holders cannot exceed three)
- Minors (only through mother, father or legal guardian)
- Companies, sole proprietorship firms, limited liability partnerships, partnership firms, bodies corporate, public sector undertakings, and international multilateral agencies
- Trusts, associations, and societies authorised to make investments in mutual funds such as charitable and religious trusts, co-operative societies, wakf boards, endowments, etc.
- Trustees or private trusts and partners of partnership companies
- Non-Resident Indians and Foreign Portfolio Investors
- Financial institutions and banks
- Navy, Army, Air Force, Para-military funds and other such organisations
- Mutual fund schemes, gratuity funds, provident funds, pension funds, and other such funds
- Schemes under IDFC Mutual Fund
- Other persons or associations permitted to make such investments
NAV Disclosure and Benchmark for IDFC Dynamic Bond Fund - Regular - Growth
NAV: The computation of the Net Asset Value (NAV) of the scheme is done on every business day. To arrive at the NAV of a scheme, the net assets of the scheme should be divided by the number of units outstanding at the end of the day. While calculating the value, the liabilities and expenses under the scheme have to be deducted from the sum of the existing assets and the market value of the investments made in the scheme. The final figure will give the NAV of the scheme. It is published in at least two popular newspapers on a daily basis.
Liquidity: Units of the scheme can be redeemed or purchased on any business day at the prevailing NAV. Once the individual submits the redemption request, the AMC will dispatch the proceeds of the redemption within 3 working days. According to the regulations set by SEBI, the AMC cannot take more than 10 days to dispatch the redemption proceeds. In case the AMC delays the dispatch, a penal interest of 15% p.a. will be payable by the AMC.
Benchmark Index: The benchmark index that has been chosen for IDFC Dynamic Bond Fund – Regular – Growth scheme is CRISIL Composite Bond Fund Index.
Fund Manager of IDFC Dynamic Bond Fund - Regular – Growth
The fund manager of the scheme is Suyash Choudhary. He has more than 17 years of experience in fixed income investments and has been associated with HSBC AMC, Standard Chartered AMC, and Deutsche Bank AG. He has been managing IDFC Dynamic Bond Fund – Regular – Growth scheme since 15 October 2010. Apart from this scheme, he manages three other schemes too.
Investment Restrictions of IDFC Dynamic Bond Fund - Regular - Growth
The AMC has listed out certain restrictions that the investor should bear in mind. Here are a few of them:
- The limit for making investments in REITs and InvITs is 10% of the NAV. REITs and InvITs issued by a single issuer are limited to 5%.
- The mutual fund cannot borrow unless it needs to meet liquidity needs to repurchase, redeem, pay interest, or pay dividends to the unitholders. More than 20% of the net assets of the mutual fund cannot be borrowed. The maximum duration to make such borrowings is 6 months.
- The AMC may make short-term deposits for not more than 91 days in certain scheduled commercial banks. Only 15% of the net assets can be deposited so. However, the limit can be extended to 20% by taking approval in advance.
- The scheme cannot make investments in listed securities issued by group companies that exceed the 25% of net assets limit, securities issued through private offering by an associate company of the sponsor, or unlisted securities issued by a group company of the sponsor.
- The assets invested in a particular scheme can be transferred to another scheme, provided the transfer is done at the market price prevailing at the time of such transfer and the investment objective of the new scheme is similar to the scheme invested in earlier.
- The scheme can make investments in other mutual fund schemes and no charges will be levied on such investments as long as the average inter-scheme investments of all schemes put together of the AMC do not cross 5% of the NAV of the mutual fund.
- Investors cannot take loans from the scheme’s corpus.
Dividend Policy of IDFC Dynamic Bond Fund - Regular - Growth
The AMC declares dividends to individuals whose names appear in the register of the unitholders. The rate of dividend and the frequency at which dividends are paid is not fixed and can vary based on the distributable surplus available under the scheme.
Other facilities under IDFC Dynamic Bond Fund - Regular - Growth
The scheme offers a few other facilities that the unit holders can benefit from. Here are a few such facilities:
- Transaction through e-mail: Corporate investors can choose to carry out transactions through email by sending scanned copies of the transaction request application. To avail services under this facility, investors are required to send emails only through registered email IDs.
- Transaction through phone: Investors can use their phones to purchase or redeem units by calling or sending predetermined keywords as SMSs from their registered mobile number to the AMC’s dedicated number.
- Transactions through the web: Investors can subscribe to units electronically through various websites that the mutual fund is partnered with. The proceeds of the subscription, in this case, are directly credited to the scheme’s collection bank account. The website that allows such transactions will collate the data and send it to the AMC for processing.
- Switch between schemes: Unitholders can choose to switch to another plan or another scheme to meet their changed requirements or changed risk appetites. In order to carry out the switch, the units from the existing scheme are redeemed and reinvested in the desired scheme. The switch out will be based on the NAV applicable at the time of switching.
Why you should invest in IDFC Dynamic Bond Fund - Regular - Growth
This scheme is ideal for individuals who are looking for a platform to achieve capital appreciation over a long term. Also, with the help of financial experts, individuals can make investments in the right schemes efficiently. IDFC has well-designed schemes under each of the fund types that investors can choose from based on their requirements. The company also has a well-set-up customer support department that will help investors in case they have queries with regard to the schemes.
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