Nippon India Strategic Debt Fund - Growth Option

Medium Duration NAV 13.5852 0 08 December, 2023

Fund Details

Category Medium Duration
Fund Type Open Ended
Investment Plan Growth
Launch Date 01 June, 2014
Benchmark CRISIL Medium Duration Fund CIII Index
Asset Size(Cr) 121.89110000000001
Turn over 0.0%
Min Investment ₹ 5000
Min SIP Investment ₹ 100
Min Addl Investment ₹ 1000
Exit Load Exit load of 1% if redeemed within 12 months
Expense Ratio 1.93
Fund Manager Kinjal Desai, Sushil Budhia, Akshay Sharma
Fund House Nippon India Mutual Fund

Investment Returns (As on 08 Dec, 2023)

Duration Returns Benchmark Category
1 W -0.01% 0.33% 0.28%
1 M -0.13% 1.68% 1.31%
3 M 0.68% 2.58% 2.31%
6 M 2.23% 5.48% 4.33%
1 Y 6.89% 7.16% 6.49%
2 Y 10.86% 5.04% 5.77%
3 Y 8.79% 5.69% 6.96%
5 Y -1.08% 8.07% 5.63%

Risk Mesasures (As on 08 Dec, 2023)

Std Dev Sharpe Beta Alpha YTM AVG Maturity
Fund 8.34 0.52 4.29 0.27 5.54 3.29
Benchmark 0 0 0 0 0 0
Returns Compare with Others
  • 1Y
  • 3Y
  • 5Y

Portfolio (As on 30 Oct, 2023)

Assets Allocation

Sector Holdings
Others 3.52%

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.
Nippon India Strategic Debt Fund - Growth Option 6.89% 8.79% -1.08%
Aditya Birla Sun Life Medium Term Plan - Growth - Regular Plan 0% 16.11% 8.08%
Kotak Medium Term Fund - Growth 5.67% 4.61% 5.89%

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Reliance Strategic Bond Fund - Low Risk Gains in Medium Duration

Reliance Strategic Bond Fund, which was previously known by the name of Reliance Classic Bond Fund, is a medium duration debt scheme. Such schemes are an ideal choice if the investors seek low-risk capital appreciation in the duration of 3 years or more. Reliance Strategic Bond Fund of Reliance Mutual Fund is chosen by a large number of investors due to consistent performance since inception. However, the credit quality of the securities selected is decent and negative returns can be seen for short term if any security gets defaulted.


What is a Medium Duration Fund?

As per the guidelines of SEBI, Medium duration debt fund is a sub category of debt mutual fund that invests in the securities with maturity tenure of 3 to 4 years. These schemes are less popular than other debt schemes as they might involve risk in the short term if interest rates are hiked. These types of schemes are only recommended if the tenure of investment is more than 3 years. Medium or long duration bonds are highly sensitive to rising interest rates in the interim period. Whenever the interest rates have been increased by RBI, the demand for these schemes have dropped and vice versa. A rise in the interest rates pulls down the bond prices which in turn lowers the NAV of medium duration mutual fund. However, these funds have gained remarkably whenever the interest rates have been dropped.


How Good is Reliance Strategic Debt Fund?

Reliance Strategic Bond Fund mainly invests in bonds and debentures of moderately rated securities and has been a consistent performer since inception in June 2014. Although it is a new entrant in the market but has done well in every market condition and has beaten the benchmark as well as peers consistently until 2018. Recently, the security with the highest allocation in the portfolio was downgraded and the NAV of Reliance Strategic Bond Fund slipped slightly. However, it has the potential to bounce back and become a top performer in the category due to proven strategies of fund manager Mr Prashant R Pimple. Reliance Strategic Bond Fund has the ability to balance the yields as most of the securities chosen are liquid.


Where Does it Invest?

The fund manager Mr Pimple focus mainly on the moderately rated securities which deliver better gains as the maturity tenure of the instruments range between 3 to 4 years. Majority of the issuers are private sector institution while securities issued by central and state government are also chosen by the manager. Nearly 80% of the corpus is invested in securities rated as AA and a smaller proportion of 10-15% is invested in AAA rated securities. The yield to maturity of the securities of Reliance Strategic Bond Fund is higher than the majority of the schemes in the category as the credit ratings of the fixed income securities are lower than peers. Due to this, the standard deviation has also failed to match with the benchmark and is higher than peers.

Reliance Strategic Bond Fund has faced security defaulting and downgrades of securities in recent times. Hence, the returns of the scheme are lower than peers. However, in the duration of 3 years or more, it has generally delivered better returns than most of the schemes in the category and has the ability to become a top performer in the future. The recent plunge in the interest rates has made it the right time to invest in this scheme. Investors can expect annual gains of more than 7% from this scheme which can even hike up to 9% under right market conditions. The SIP return calculator at MySIPonline can be used to get a better idea of what can be gained from the scheme in a known period.


Who Should Invest?

Reliance Strategic Bond Fund is suitable for the investors who seek capital appreciation in the duration of 3 years or more. The fund possesses moderate risk in the debt category as the NAV of the scheme might fluctuate in the short term. Rising interest rates can be bad news for the investors but better gains are likely to be gained if the interest rates are falling. The investment in Reliance Strategic Bond Fund must be done according to the suitability and the investors are advised to take the assistance of financial experts.

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