IDBI Mutual Fund house has come out with a Bond Fund and its NFO is currently open. In this article, we will explore this IDBI Dynamic Bond Fund and see whether this Bond fund from IDBI is any useful to investors and which class of investors does this IDBI Dynamic Bond Fund suit.
Let's begin with some basic details of IDBI Dynamic Bond Fund:
What actually is this IDBI Dynamic Bond Fund?
IDBI Dynamic Bond Fund is a fund launched by IDBI mutual fund house and like any other mutual fund this fund will also collect money from investors and invest in certain financial instruments with an aim to generate good returns.
Since this is a Bond fund, the money collected will be invested in Bonds and similar other Debt based and money market instruments. Hence, the returns from this fund will not be that volatile as like those from equity or stock based mutual funds, but this fund claims to be less risky compared to the equity mutual funds.
Traditionally, Indian investors go for stock based mutual fund, but lately debt based mutual funds are also gathering good customer interest hence this fund may find a good interest in the market.
Also, we have observed a good long period of high interest rates where returns from debt instruments have been better than equity markets. So that is what the fund managers of this IDBI Dynamic Bond Fund are trying to capitalize upon.
Being a Bond or Debt fund, are returns guaranteed from this IDBI Dynamic Bond Fund?
No, nothing is guaranteed. No bond fund or debt fund would ever (or can guarantee) any returns or capital protection and same is true for this IDBI Dynamic Bond Fund also.
Investors should not live under the impression that bond funds are risk free or come with any kind of guaranteed returns.
What are the NFO dates for IDBI Dynamic Bond Fund?
The IDBI Dynamic Bond Fund is open from 31 January 2012 to 14 February 2012 for its NFO period
IDBI Dynamic Bond Fund Review Analysis & Details
What will be the benchmark index for tracking returns of IDBI Dynamic Bond Fund?CRISIL Composite Bond Fund Index will be used for tracking performance of IDBI Dynamic Bond Fund
What are the other investment details of IDBI Dynamic Bond Fund?
Minimum investment in IDBI Dynamic Bond Fund is Rs. 5000 and in multiples of Re. 1 thereafter.
Multiple options available for investments:
Growth Option
Dividend Option - Payout will be quarterly or annual (as per the availability)
Face value will be Rs. 10
Mr. Gautam Kaul will be the fund manager
Systematic Investment Plan (SIP) for IDBI Dynamic Bond Fund?
SIP is available for IDBI Dynamic Bond Fund:
If you go for monthly option for a minimum 12 months, then Rs. 500 minimum per month and multiples of Re. 1 above that.
For 6 months, Rs. 1000 minimum per month and multiples of Re. 1 above that.
For Quarterly Option, Rs 1500 minimum per quarter and multiples of Re. 1 above that, for minimum 4 quarters
What are the entry load and exit load charges for IDBI Dynamic Bond Fund
Entry Load NIL
Exit load NIL
Is there any tax saving or tax benefit available in IDBI Dynamic Bond Fund
No, there will be no tax saving or tax benefit
See List of All Mutual Fund and NFO Articles here
Final Thoughts about IDBI Dynamic Bond Fund
A good option for investors who are willing to look for some exposure to the debt instruments and money market securities. However, please note that the returns are not guaranteed, nor is the capital protected with any guarantee. Bond funds do come with their own set of risks (although they are less volatile compared to equity fund.
IDBI Dynamic Bond Fund
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