| Debt MFs exposure in G-secs surges on rate cut hopes |
India's debt mutual fund managers' fancy with investment in government securities (G- secs) is continuing. In the past one year, fund managers have doubled their exposure to G- secs through gilt funds. Their overall exposure in the asset category is 14 per cent, a level not seen earlier for years. About ₹ 1.26 lakh crore of debt assets have found their way into G- secs. A year before, the amount pumped into this security was ₹ 55,000 crore, show statistics from the Securities and Exchange of India. A global drop in oil and commodity prices has raised expectation that interest rates and, thus, G- sec yields could be headed downwards for the long term. Recent inaction from the US Federal Reserve has further strengthened fund mangers expectations on rate cuts. Pankaj Murarka, head of equities at Axis Mutual Fund, says, " Over the next three quarters, we see a cut of 75 basis points in interest rates." Two months earlier, the fixed income market was expecting volatility because of the Greek situation and a potential rate increase by the US Federal Reserve. However, recent developments have settled these concerns. According to S Naren, chief investment officer of ICICI Prudential MF, " We believe that towards the end of the year, there is a likelihood of an interest rate cut." The allocation towards gilts has been increased to benefit from the rate easing cycle of the Reserve Bank. Lower headline inflation and benign commodity prices create a case for further rate easing. Most fund managers have been opting for longer duration debt paper, as these are likely to benefit the most from areversal in the monetary policy stance. According to them, fixed income products with a three to five years duration will benefit the most. Nearly 95 per cent or ₹ 1.2 lakh crore of the allocation in government paper is in securities with maturity of a year or above. "We believe that duration funds might prove an attractive investment over the next one year. The shorter term rates have already fallen and this could be an opportune time to invest in funds with a three- year and above maturity profile. Also, the yield curve is flat at the longer end of the curve; hence, the opportunity lies there |
Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015
1.ICICI Prudential Tax Plan
2.Reliance Tax Saver (ELSS) Fund
3.HDFC TaxSaver
4.DSP BlackRock Tax Saver Fund
5.Religare Tax Plan
6.Franklin India TaxShield
7.Canara Robeco Equity Tax Saver
8.IDFC Tax Advantage (ELSS) Fund
9.Axis Tax Saver Fund
10.BNP Paribas Long Term Equity Fund
You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds
Invest in Tax Saver Mutual Funds Online -
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
---------------------------------------------
Leave your comment with mail ID and we will answer them
OR
You can write to us at
PrajnaCapital [at] Gmail [dot] Com
OR
Leave a missed Call on 94 8300 8300
---------------------------------------------
Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs
Posts
No comments:
Post a Comment