The Principal Low Duration Fund - Monthly Dividend Option is ideal for investors who are looking for capital appreciation and regular income over a short-term investment horizon by investing in debt and money market instruments. In a bid to optimise the associated risk return proposition for the benefit of the unitholders, this mutual fund will focus on credit risk, liquidity management, and macro-economic research. In addition to maintaining a sizeable investment in relatively liquid investments, this plan also applies for the credit evaluation process and receives guidance from rating agencies. With the option for either Regular Plan or Direct Plan, this mutual fund scheme offers 2 investment options to the investors under each plan - the Growth Option and the Dividend Option. While the daily and weekly dividend option of this scheme only carries the Dividend Reinvestment suboption, the monthly dividend option offers 3 subcategories to the investors - Dividend Sweep, Dividend Reinvestment, and Dividend Payout.
Investment Objective of Principal Low Duration Fund - Monthly Dividend Option
The main objective of this scheme is to generate regular income while providing capital growth through investments in debt securities and money market instruments. It should be noted that the Macaulay duration of the complete portfolio of this mutual fund should be from 6 months to 12 months. However, the asset management company (AMC) does not offer any guarantee that this investment objective will be met and the investor will be able to receive guaranteed returns.
Key Features of Principal Low Duration Fund - Monthly Dividend Option
This mutual fund carries several characteristics that make it one of the best investment option available in the market. Some of the significant features of Principal Low Duration Fund - Monthly Dividend Option are indicated in the table below:
| Type of fund | An open-ended, low-duration debt scheme that invests in instruments in a way so that the Macaulay duration of the portfolio ranges between 6 months and 12 months |
| Plans available |
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| Options under each plan |
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| Risk | Moderately low |
| Systematic Investment Plan | Available |
| Systematic Transfer Plan | Available |
| Regular Withdrawal Plan | Available |
Investment Amount for Principal Low Duration Fund - Monthly Dividend Option
Check out the table mentioned below and learn about the important fees and charges that you might have to pay once you opt for this investment option:
| Minimum application amount | Rs.5,000 and any amount subsequently under each option or plan |
| Minimum additional investment | Rs.1,000 and any amount under each option or plan thereafter |
| Minimum installment for Systematic Investment Plan (SIP) | Rs.2,000 for a minimum of 6 installments |
| Minimum installment for Regular Withdrawal Plan (RWP) | Rs.500 for a minimum of 6 installments |
| Minimum installment for Systematic Transfer Plan (STP) | Rs.1,000 for a minimum of 6 installments |
| Entry Load | Not applicable |
| Exit Load | Nil |
Asset Allocation for Principal Low Duration Fund - Monthly Dividend Option
| Instruments | Allocations (Percentage of total assets) | Risk Profile |
| Debt securities and money market instruments which includes cash and CBLO along with units of liquid, debt, or money market mutual fund schemes | 0% to 100% | Low to medium |
It should be noted that the maximum investment that can be made by this scheme in securitised debt is 50% of its net assets. The fund might also choose to invest up to 50% of its net assets in derivative instruments for the purpose of hedging and portfolio balancing in accordance with the SEBI Mutual Fund Regulations, 1996. This scheme can also invest up to 20% of its net assets in securities lending. Furthermore, the investment in the units of money market, liquid, or debt mutual fund schemes should be up to a maximum of 5% of the net asset value of the mutual fund. The Macaulay duration of the entire portfolio of the scheme must range between 6 months and 12 months.
NAV Disclosure and Benchmark for Principal Low Duration Fund - Monthly Dividend Option
NAV - Under this mutual fund, the investor can sell and repurchase his or her units on an ongoing basis based on their Net Asset Values (NAVs) in order to achieve the desired liquidity. The Securities and Exchange Board of India (SEBI) Regulations mandate that the scheme must dispatch proceeds for the redemption of units within 10 working days starting from the date of receiving the redemption request. Additionally, the AMC shall calculate the NAV for every working day and disclose it to news agencies, the press, and the Association of Mutual Funds in India (AMFI). The AMC should publish the NAVs on its official website at www. Principalindia.com and on the AMFI website at www.amfiindia.com by 9.00 p.m. of every working day or any other time as instructed by the SEBI or AMFI.
Benchmark Index - The benchmark followed by Principal Low Duration Fund - Monthly Dividend Option is the CRISIL Low Duration Debt Index.
Principal Low Duration Fund - Monthly Dividend Option Fund Manager
The fund manager for Principal Low Duration Fund - Monthly Dividend Option is Mr. Pankaj Jain who has been handling the scheme since January 2012. Mr. Jain offers his expert guidance to investors looking to invest under this scheme in order to help them select the right investment strategy based on their specific investment goals and unique risk-taking capacities.
Why You Should Invest in Principal Low Duration Fund - Monthly Dividend Option
- This scheme offers high returns with a moderately low risk factor.
- This fund is ideal for investors who want to generate capital growth over a short-term investment horizon along with providing regular returns.
- Investors can opt for the STP, RWP, and SIP facilities based on their convenience.
- This scheme does not carry any exit load.
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