The latest mutual fund offering from PPFAS Asset Management offers exposure to debt instruments, equity and REITs. We tell you what the fund is all about.
| Good to know
What is a hybrid fund? A hybrid fund is a type of mutual fund or an exchange-traded fund (ETF) that diversifies its holdings in multiple asset classes in a single fund. Such funds typically invest in a mixture of stocks and fixed-income assets such as bonds and debt instruments. A conservative hybrid fund is a scheme that majorly invests in debt instruments. About 75–90% of the assets will be allocated to debt instruments, while about 10–25% goes into equity-related instruments. What is a debt instrument? A debt instrument is an asset that returns a fixed interest on an investment in addition to paying back the principal. The issuer of the instrument typically uses it to raise funds at a cost, typically from the public instead of approaching a bank. What are REITs/InvITs Real Estate Investment Trusts (REITs) / Infrastructure Investment Trusts (InvITs) are investment trusts that allow investors to pool capital and invest in real estate and infrastructure assets without actually owning them. They are similar mutual funds, with a crucial difference that instead of stocks, the underlying assets comprise real estate and infrastructure projects. REITs predominantly own and operate investment-grade properties such as industrial parks, malls and offices. Meanwhile, InvITs invest in infrastructure projects such as roads and highways. |
Investment objective
The scheme aims to generate regular income through investments predominantly in debt and money market instruments. It also expects to generate long-term capital appreciation from the portion of equity investments. It’s worth noting that the scheme does not assure or guarantee any returns.
Here’s the scheme’s investment strategy with respect to various asset classes
- Debt portfolio: Investments in this class predominantly comprise sovereign, state government and high-quality PSU securities and AAA papers. These aim to provide reasonable returns with low volatility and limited ‘corporate credit risk’ related exposure
- Equities: Preference will be given to stocks with strong cash flows (higher dividend payout/buybacks)
- Units of REITs and InvITs: Investment in these instruments is an attempt to provide regular income to investors in the form of dividends, interest, or capital repayment.
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Asset allocation
| Instrument | Allocation (% of total assets) | Risk profile | |
| Minimum | Maximum | ||
| Debt securities (including securitized debt) & Money Market instrument | 75 | 90 | Low to Medium |
| Equities & Equity related instruments | 10 | 25 | Low to Medium |
| Units issued by REITs and InviTs | 0 | 10 | Medium to high |
Scheme details
| Name | Parag Parikh Conservative Hybrid Fund |
| Type | An open-ended hybrid scheme investing predominantly in debt instruments |
| Category | Conservative Hybrid Fund |
| Benchmark | CRISIL Hybrid 85+15 - Conservative Index TRI^ |
| Plans | Direct and Regular |
| Options | Growth and Dividend |
| Entry/exit load |
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| Fund Manager |
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| Minimum application amount | ₹5000 and in multiples of ₹1 thereafter. |
| Additional Purchase | ₹1000 and in multiples of ₹1 thereafter. |
| Expense ratio | Direct: 0.30% p.a | Regular: 0.60% p.a |
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| This product is suitable for investors who are seeking*: | Riskometer |
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Note: The above information has been sourced from the Scheme Information Document provided by PPFAS Asset Management Private Limited. To read the entire document, click here.
Disclaimer: The above article is purely academic in nature and aims to provide knowledge about basic trading concepts & should not be construed as an opinion or advice to invest or trade. RKSV Securities India Private Limited (brand name Upstox) is the distributor of the mutual fund. Mutual fund investments are subject to market risks; please read all the related documents and/or consult your investment advisor before investing. Past performance of an investment asset does not guarantee future returns.
Mutual fund investments are subject to market risks, read all scheme related documents carefully.
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