Kotak Credit Risk Fund - Growth

Credit Risk NAV 25.6554 0 27 September, 2023

Fund Details

Category Credit Risk
Fund Type Open Ended
Investment Plan Growth
Launch Date 01 May, 2010
Benchmark CRISIL Short-Term Bond
Asset Size(Cr) 1099.5022999999999
Turn over 78%
Min Investment ₹ 100
Min SIP Investment ₹ 1000
Min Addl Investment ₹ 100
Exit Load For units in excess of 6% of the investment,1% will be charged for redemption within 365 days
Expense Ratio 1.7
Fund Manager Deepak Agrawal, Vihag Mishra, Sunit Garg
Fund House Kotak Mutual Fund

Investment Returns (As on 27 Sep, 2023)

Duration Returns Benchmark Category
1 W 0.25% 0.37% 0.16%
1 M 1.11% 1.16% 0.98%
3 M 2.17% 2.56% 2.26%
6 M 3.23% 4.67% 4.05%
1 Y 4.13% 7% 5.36%
2 Y 3.3% 6.1% 9.99%
3 Y 5.6% 7.08% 9.74%
5 Y 5.65% 8.46% 4.5%

Risk Mesasures (As on 27 Sep, 2023)

Std Dev Sharpe Beta Alpha YTM AVG Maturity
Fund 2.32 0.66 5 2.42 8.27 3
Benchmark 0 0 0 0 0 0
Returns Compare with Others
  • 1Y
  • 3Y
  • 5Y

Portfolio (As on 30 Jun, 2023)

Assets Allocation

Sector Holdings
Others 4.2%

Return Calculator

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Disclaimer: Above returns are calculated on the basis of historical NAV movement for the selected period. However, historical performance does not guarantee future returns. Investors must take investment decisions based on his/her own requirements.

Peer Comparison

Fund Name 1 Yr Rtn. 3 Yr Rtn. 5 Yr Rtn.
Kotak Credit Risk Fund - Growth 4.13% 5.6% 5.65%

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Kotak Credit Risk Fund - Better Gains Through Debt Tools

Credit risk funds are the mutual funds that invest in the fixed income securities of lower credit ratings. This category of debt mutual funds has been gaining popularity due to its ability to provide better returns than any other debt scheme. Kotak Mutual Fund has responsibly given a better opportunity to the investors to gain reasonable returns from high-risk debt securities by launching Kotak Credit Risk Fund. It is among the best credit risk funds in India which have greatly impressed critics and investors on the basis of multiple parameters.

Credit-Risk Mutual Funds Explained

A credit risk mutual fund is considered as high-risk debt fund as they invest in low rated securities which can deliver high returns. Although, the risk is less than that of equity mutual funds. As per the norms of SEBI, a credit risk fund has to invest a minimum of 65% of the total corpus in the fixed income securities which are rated less than AA. The credit ratings of the securities are decided on basis of multiple factors like default risk, liquidity risk, inflation adjustment, track record of the issuer, etc. The credit rating agencies are regulated by SEBI. Lower-rated papers tend to provide higher returns as they are generally issued by smaller companies which promise to give higher interest rates. Credit risk mutual funds have the ability to provide 2-4% higher returns than other low-risk debt schemes.

How Good is Kotak Credit Risk Fund?

Kotak Credit Risk Fund was launched in May 2010 to provide better returns than other debt schemes through lower-rated securities. Soon after inception, it became a top performer in the category and provided best gains. It has provided double-digit returns in rolling tenure of 1 year several times. The fund invests in securities across the yield curve and different credit ratings. The instruments provide maturity amount after a fixed tenure and apart from that, Kotak Credit Risk Fund also gains value if lower rated security in the portfolio gets upgraded to higher ratings. It has shown lower fluctuations than a majority of the other schemes in the category and has delivered consistent gains.

Kotak Credit Risk Fund - Portfolio Analysis

The fund manager Mr Deepak Agrawal has a vast experience in the asset management business and has been associated with Kotak AMC since 2000. For Kotak Credit Risk Fund, he selects a large number of securities of various credit ratings to diversify the portfolio. Bonds, debentures, commercial papers, certificate of deposits are chosen from various issuers. Nearly 100 securities are chosen for the portfolio which jointly offers volatility or standard deviation of 1.42% while the category average is 1.99%. The securities have average maturity tenure of more than 3 years which can go low to 2 years according to the market conditions. Even though it belongs to a high-risk category of debt funds, the fluctuations have been controlled by the manager and stable gains have been delivered.

How Much Investors Have Gained?

Kotak Credit Risk Fund has provided better returns than benchmark every time since inception and category average has also been defeated most of the time. In fertile market conditions of 2014 and 2016, it has rewarded double-digit gains within a year which is the reason why it is trusted by a large number of investors. The most productive one year tenure was from Aug 2013 to Aug 2014 when NAV of Kotak Credit Risk Fund surged by 12.68%. Investors can invest in this scheme for a duration of 1-3 years and can expect annual gains of anywhere between 8-10% which might alter depending on the revamping of interest rates and repo rate. Investors and potential investors can check the gains they will hold after a known period conveniently by using the mutual fund SIP return calculator designed by MySIPonline.

Who Should Invest in Kotak Credit Risk Fund?

Kotak Credit Risk Fund takes marginally higher risk to gain higher accrual. It also aims to maintain liquidity within the scheme without affecting the capital gains. Investors with a low-risk appetite who prefer investing in lower-rated securities to gain better returns can consider investing. The investment tenure must be more than a year as the average maturity tenure of the securities range between 2-3 years. It also charges an exit load of 1% for 365 days if the redemption amount is more than 10% of the total investment. For those investing for the first time, it is advisable to consult with an expert before investing.

Kotak Credit Risk Fund is one of the best credit risk funds with proven track records and superior management staff. It allows investment through SIP as well as lump sum with a minimum amount of Rs 5000 for the initial investment. If the fund suits your investment objectives and is within your risk appetite, start investing today through our website or official app and avail the dashboard facility where you can track all your investment at one place.

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