IDFC Floating Rate Fund - NFO closes on on 16 February 2021

The IDFC Floating Rate Fund is a debt scheme that predominantly invests in floating rate instruments. The NFO is live and closes on 16 February. Here are its details.

Good to know Floating rate instruments These are debt instruments with an interest rate that are reset periodically. The periodicity of the interest reset could be daily, monthly, quarterly, half-yearly, annually or any other periodicity that may be specified in the terms of the investment scheme. Investment-grade credit ratings Financial instruments are rated ‘AAA’, ‘AA’, ‘BBB’, to indicate the likelihood of default, or the possibility of the debt obligation not being met as promised. Instruments rated AAA are considered the safest. Meanwhile, instruments labelled ‘+AA’, ‘AA’ and ‘-AA’ are considered to have a high degree of safety and carry very low default risk.

Investment objective

The fund aims to generate returns by creating a portfolio of floating-rate instruments and other debt and money market instruments. It is a satellite instrument, meaning a fund that can accommodate duration risk or credit risk or both.

Duration risk refers to the idea that changes in interest rates may reduce the value of an asset’s value. Further, the fund does not aim to invest in securities rated lower than AA- at the time of investment.

As per the fund house, the scheme is suitable for those who aim to stay invested for over six months.

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Asset allocation

Instrument	Allocation (% of total assets)		Risk profile
	Minimum	Maximum
Floating Rate instruments (including fixed-rate instruments converted to floating rate exposures using swaps/derivatives)	65	100	Low to medium
Debt and Money Market Instruments other than Floating Rate instruments	0	35	Low to medium
Units issued by REITs & InvITs	0	10	Medium to high

Scheme details

Name	IDFC Floating Rate Fund
Type	Open-ended debt Scheme predominantly investing in floating rate instruments
Category	Mutual fund
Investment objective	xxx
Benchmark	Nifty Low Duration Debt Index
Entry/Exit load	Entry Load: Nil Exit Load: Nil
Fund manager	Mr. Anurag Mittal Mr. Arvind Subramanian
Options	Dividend and Growth
Minimum application amount (during NFO)	₹5,000 and in multiples of ₹1 thereafter
Additional application amount	₹1,000 and in multiples of ₹1 thereafter

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This product is suitable for investors who are seeking*:	Riskometer
To generate short-term optimal returns To invest predominantly in floating rate instruments

*Investors should consult their financial advisors if in doubt about whether the product is suitable for them.

Note: The above information has been sourced from the Scheme Information Document provided by IDFC Asset Management Company Limited. To read the entire document, click here. Disclaimer RKSV Securities India Private Limited (ARN/Distributor - 107930; brand name Upstox) is the distributor of the mutual fund. Please consult your investment advisor before investing.

Mutual fund investments are subject to market risks, read all scheme related documents carefully.