ABSL Corporate Bond Fund

ABSL Corporate Bond Fund is an open-ended scheme with high exposure to debt markets. The Fund invests in money instruments such as treasury bills, government securities, corporate bonds, and other investment vehicles. The ABSL Corporate Bond Fund primarily aims at creating wealth for its unitholders by preserving their capital and generating adequate returns.

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Brief introduction of ABSL Corporate Bond Fund 

The Fund has more than ten years of track record in the debt markets comparable to the benchmark index of NIFTY Corporate Bond TRI. 

The ABSL Corporate Bond Fund comes in three variants:

  • ABSL Corporate Bond Fund-Regular Growth
  • ABSL Corporate Bond Fund-Direct Growth
  • ABSL Corporate Bond Fund-IDCW Direct and regular

The Direct Plan is available only from the asset management company, whereas the Regular Plan is sold through third parties and intermediaries such as brokers. The Fund allocates 97% of its capital in debt instruments, while the remaining is held as cash holdings.

The fund house has also invested their money across different sectors ranging from the financial sector, construction sector, energy sector, etc. The Fund also offers an option for dividend payout, which the unitholders can utilize for re-investment purposes or additional income. The investor can choose the payout frequency as monthly or quarterly depending on his needs.

Investment Facts

Parameter

Details

Fund Name

ABSL Corporate Bond Fund 

Fund House

Aditya Birla Sun Life AMC Limited

Launch Date

March 03, 1997

Benchmark

NIFTY Corporate Bond TRI

Type

Open-ended debt  scheme

Minimum Investment

Rs.100

Lock-in Period

No lock-in period

Entry Load

NIL

Exit Load

NIL

Return Performance

High

Fund Consistency

Average

Risk Level

Moderate

Investment Objective

ABSL Corporate Bond Fund strives to create wealth in a sustained way by preserving the unitholders' capital and compounding the initial lump sum investment made by them. The debt funds are usually preferred by investors planning to realize their goals, such as purchasing a four-wheeler or buying an apartment, etc. 

The fund house ensures adequate liquidity in the invested assets for timely availability of cash during redemption. An investment in corporate bonds is sufficient for the investors' portfolios to generate moderate returns in a sustained manner.

Since its inception, the Fund has generated annualized returns of over 9%, which is higher than the fixed deposit investment schemes. The debt funds are also known for their tax efficiency and consistent cash flows to the unitholders.

Fund Summary

  1. ABSL Corporate Bond Fund-Direct Growth

    • Risk-level- Moderate
    • NAV-87.24  as of June 18, 2021
    • Expense Ratio-0.46%
    • Fund Started- March 03, 1997
  2. ABSL Corporate Bond Fund-Regular Growth

    • Risk-level- Moderate
    • NAV-87.23 as of June 18, 2021
    • Expense Ratio-0.46%
    • Fund Started- March 03, 1997
  3. ABSL Corporate Bond Fund-IDCW Direct and regular

    • Risk-level- Moderate
    • NAV-12.48 as of June 18, 2021
    • Expense Ratio-0.3%
    • Fund Started- October 11, 2013

Fund Returns Summary

  1. ABSL Corporate Bond Fund-Direct Growth-Returns Summary

    Period

    Annualized returns per year

    6 months

    2.08%

    1 year

    7.13%

    3 years

    9.37%

    5 years

    8.52%

    10 years

    9.09%

  2. ABSL Corporate Bond Fund- Regular Plan Growth-Returns Summary

    Period

    Annualized returns per year

    6 months

    2.08%

    1 year

    6.96%

    3 years

    9.36%

    5 years

    8.52%

    10 years

    9.09%

  3. ABSL Corporate Bond Fund- IDCW Direct and regular-Returns Summary

    Period

    Annualized returns per year

    6 months

    2.08%

    1 year

    7.13%

    3 years

    9.37%

    5 years

    8.51%

    10 years

    9.32%

Pros and Cons

Pros

Cons

The Fund has a track record for more than a decade

The returns can get diminished due to the higher value of AUM.

Low expense ratio of 0.46%

Not beneficial for day traders. 

The exit load and entry load is zero.

The Fund allocates none of its capital inequities

One of the best performing funds in the category

A cautious approach to the credit risk 

No lock-in periods

Sub-par returns in comparison to equities.

Benefits of ABSL Corporate Bond Fund

  1. Higher Returns in the corporate bond fund category

    The Fund provides the best returns in the corporate bond category, constantly outperforming the market indices by a few basis points. ABSL, with its astute research team, ensures the wealth creation for its unitholders by choosing bonds with higher ratings, thereby avoiding credit and liquidity crunch at the time of maturity or redemption.  The highly-rated ABSL fund has generated excellent returns of over 9% annually ever since its inception.

  2. Alternative to fixed deposit scheme

    The scheme is an alternative to fixed deposit schemes. The investor can park his emergency funds, savings fund, and other goal-oriented funds to be deployed in a shorter time frame. The investor prevents the erosion of his hard-earned money through dipping interest rates in the bank by making a conscious choice to invest in ABSL Corporate Bond Fund. The bond fund acts as a hedge during unprecedented global factors related to rising costs of consumer goods.

  3. Capital Preservation

    The debt market is less volatile and provides steady returns along with the compounding of the invested money. The investor need not worry about losing money, as in the case of highly volatile share markets. The amateur investor can test his investing principles by placing his earnings in a short-term bond fund. The debt market ensures that the investor doesn’t endure loss during uncertain times. 

  4. Diversification

    The ABSL Corporate Bond Fund is well-diversified with capital allocations across various sectors ranging from private industries to public industries found in the nation. The investment is made across companies that generate higher interest rates. The Fund provides more significant weightage to government-backed securities and allocates more than 70% of its capital to low-risk Non-convertible Debentures and bonds.

Fund House Details

The Fund is managed by Aditya Birla Sun Life AMC Limited, which is jointly owned by Aditya Birla Capital Limited and Sun Life (India) AMC Investments Inc. The Company has more than Rs.2.6 lakh crore of domestic assets under management. It is one of the most recognized fund houses in the nation. 

ABSL Asset Management Company Limited has its presence across 280 locations in the country, encouraging investment habits across sections of the society. It offers various financial products and investment services to its customers, such as equities, debts, bonds, life insurance, etc. The Company also provides portfolio management services and real estate investments in a customized way to its customers.

Who Should Invest in ABSL Corporate Bond Fund?

The Fund is tailor-made for people looking to make short-term gains with personal goals such as buying a car, a house, and a leisure trip to a dream destination. The Fund shields the capital from losses and ensures adequate income for its unitholders. 

The ABSL Corporate fund is also suited for investors looking to take advantage of income through dividends. The Fund offers a dividend distribution option to its unitholders in which the dividends are doled out on a monthly or quarterly basis.

Wrapping It Up

The ABSL Corporate Bond Fund is one of the highly-rated debt funds in the country with a significant AUM. The investor must analyze his risk appetite before choosing the plan. The amateur investor must be cautious about liquidity risk, credit risk, and the expense ratios related to the Fund. However, the Fund is best-suited for risk-averse unitholders looking to redeem the funds in under 365 days.

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