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IDFC Bond Fund - Short Term Plan

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IDFC Bond Fund - Short Term Plan
Morningstar India - 08 September 2019

Suyash Choudhary is an accomplished and a seasoned manager in running duration strategies. His strength lies in his in-depth understanding of the macroeconomic environment, ability to anticipate interest rate movements, and identify attractive investment opportunities across market segments.

Studying the macro-economic scenario for taking interest rate directional view forms the broader framework of the process. The interest rate direction is determined by conducting a detailed analysis of various influencing factors such as growth versus inflation, fiscal and current account deficit, private sector and government borrowings, fiscal and monetary policy view, money supply, currency market movement and global interest rate scenario among others. This is complemented by an overlay of technical factors where the team examine the demand supply dynamics in order to get clarity on valuations and direction of yield curve.

For investments in corporate bonds, the team lays lot of emphasis on the promoter group, its track record and corporate governance standards. Additionally, he also looks at companies competitive standing vis-à-vis peers, its practices, cash flows, liquidity profile, business and financial risks among others.

The modified duration is typically maintained between 1.5 and two years. Additionally, the manager prefers staying clear of credit bets in this fund and hence invests primarily in AAA or equivalent rated securities. The fund is a solid option for investors looking for lower risk short duration funds.

 

 

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