HDFCAMC - HDFCLIQUID ETF

About HDFC Nifty 1D Rate Liquid ETF

• HDFC Nifty 1D Rate Liquid ETF is an open-ended liquid debt scheme launched by HDFC Mutual fund house.
• The fund invests in government securities and treasury bills with a maximum maturity period of three months.
• The fund was launched on August 24, 2023.
• Vikas Agarwal is the manager of the HDFC Nifty 1D Rate Liquid ETF.
• HDFC Nifty 1D Rate Liquid ETF has assets under management (AUM) that stood at ₹20.83 crore as of June 30, 2024.
• Listed on the NSE, and BSE, the ETF units can be traded like equites during the market hours.
• One can invest in the scheme by buying the ETF units directly through a demat account with a registered broker.

Investment Objective & Benchmark

• The objective of the HDFC Nifty 1D Rate Liquid ETF is to invest in Tri-Party Repos in Government Securities or Treasury Bills (TREPS).
• It is benchmarked against the Nifty 1D Rate Index which uses the overnight rate provided through the “Triparty Repo Dealing System (TREPS)" for the computation of index values.
• The HDFC Nifty 1D Rate Liquid ETF aims to provide returns that closely correspond to the overnight call money market rates, measured by the Nifty 1D Rate Index.
• The ETF can be used as collateral for margin purposes.
• Bond ETFs can provide significant tax efficiency benefits, including reduced tax rates and potential indexation advantages for long-term capital gains.
• This ETF invests in money market instruments such as treasury bills, certificates of deposit, commercial papers and other short-term debt instruments that provide liquidity and safety.
• A low-risk instrument, the ETF is suitable for investors seeking stable income and capital preservation over the investment horizon.
• The advantages of HDFC Nifty 1D Rate Liquid ETF provide investors with an opportunity to invest in a low-risk, highly liquid instrument that tracks short-term interest rates effectively. It serves as a useful tool for managing short-term liquidity and parking funds.
• Investors can expect predictable returns as the ETF primarily invests in fixed-income securities with known maturity dates and coupon payments.

Asset Allocation & Portfolio Composition

• The asset allocation of HDFC Nifty 1D Rate Liquid ETF comprises around 100% in cash & cash equivalents.
• Since its inception, the fund has delivered a return of 5.67%. Returns can fluctuate based on changes in interest rates and market conditions.