ICICI Prudential Short Term Debt Fund

ICICI Prudential Short Term Debt Fund is an open-ended short duration debt fund scheme that invests primarily in debt securities maturing over a tenure of 1-3 years. The fund generates higher returns than bank fixed deposits. The fund portfolio includes 34.67% investment in sovereign GOI bonds, 37.45% in AAA-rated debt securities, and 14.74% in top-rated debt securities.

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ICICI Prudential short term debt fund is available in four plan categories:

Growth - Regular
IDCW as and when - Regular
Growth - Direct
IDCW as and when - Direct

Investment Facts

Parameter	Details
Fund Name	ICICI Prudential Short Term Debt Fund
Fund House	ICICI Prudential Mutual Fund
Launch Date	25-Oct-2001
Benchmark	CRISIL Short-Term Bond TRI
Type	Open-Ended
Minimum Investment	Rs. 5,000 Minimum Additional Investment: Rs.1,000 Minimum SIP Investment: Rs.1,000
Lock-in Period	Not applicable
Entry Load	Nil
Exit Load	Nil
Return Performance	Above Average
Fund Consistency	Moderate
Risk Level	Below Average

Investment Objective

ICICI Prudential short term debt fund aims to generate steady income from debt securities. It consists of government securities, market instruments, treasury bills, and corporate bonds with a targeted duration between one year and three years.

Fund Summary

ICICI Prudential Short Term Debt Fund Regular Plan-Growth
- Risk level-Moderate
- NAV-Rs. 46.519 (as of 08.07.2021)
- Expense Ratio-1.15% (as on 31.05.2021)
- Fund Started-25.10.2001
ICICI Prudential Short Term Debt Fund Regular Plan IDCW
- Risk level-Moderate
- NAV-Rs. 12.0697 as of 08.07.2021 (Monthly)
- NAV-Rs. 12.2457 as of 08.07.2021 (Fortnightly)
- NAV-Rs. 13.3845 as of 08.07.2021 (Half Yearly)
- Expense Ratio-1.15% (as on 31.05.2021)
- Fund Started-25.10.2001
ICICI Prudential Short Term Debt Fund Direct Plan-Growth
- Risk level-Moderate
- NAV-Rs.49.428 as of 08.07.2021
- Expense Ratio-0.39% (as on 31.05.2021)
- Fund Started-01.01.2013
ICICI Prudential Short Term Debt Fund Direct Plan IDCW
- Risk level-Moderate
- NAV-Rs. 12.6872 as of 08.07.2021 (Monthly)
- NAV-Rs. 12.8371 as of 08.07.2021 (Fortnightly)
- NAV-Rs. 13.6411 as of 08.07.2021 (Half Yearly)
- Expense Ratio-0.39% (as on 31.05.2021)
- Fund Started-01.01.2013

Fund Manager

Mr Manish Banthia (since January 2013)
Mr Nikhil Kabra (since December 2020)

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Fund Returns Summary

ICICI Prudential Short Term Fund Regular Plan-Growth

Period

Returns Per Year (Annualized)

6 Months

1.63%

1 year

5.33%

2 years

8.35%

3 years

8.54%

5 years

7.88%

10 years

8.56%

Since Inception

8.11%

ICICI Prudential Short Term Fund Regular Plan IDCW (Annualized)

Period	Monthly	Fortnightly	Half Yearly
6 Month	1.62%	1.62%	1.57%
1 Year	5.28%	5.30%	4.69%
2 Year	7.20%	7.31%	6.90%
3 Year	6.67%	7.02%	7.07%
5 Year	5.81%	6.01%	7.00%
10 Year	6.63%	6.71%	7.45%
Since Inception	6.79%	6.70%	1.57%

ICICI Prudential Short Term Fund Direct Plan-Growth

Period

Returns Per Year (Annualized)

6 Months

2.01%

1 year

6.13%

2 years

9.17%

3 years

9.37%

5 years

8.74%

Since Inception

9.15%

ICICI Prudential Short Term Fund Direct Plan IDCW (Annualized)

Period	Monthly	Fortnightly	Half Yearly
6 Month	2.01%	2.01%	1.94%
1 Year	6.08%	6.10%	5.41%
2 Year	8.01%	8.12%	7.56%
3 Year	7.50%	7.83%	7.49%
5 Year	6.63%	6.80%	7.49%
Since Inception	7.04%	7.11%	8.18%

Summative Pros and Cons

Pros	Cons
The fund has outperformed the Benchmark: CRISIL Short-Term Bond TRI over 2 years out of the last 3 years.	The fund has not performed better than the benchmark in the 3 years.
Unlike a fixed deposit, the investor gets an indexation benefit for computing income tax if units are held for more than 3 years.	Unlike a fixed deposit, there is no assured interest or principal repayment.

Benefits of ICICI Prudential Short Term Debt Fund

Investment in ICICI Prudential short term debt fund provides the following benefits to the investors:

Achieving Short-Term Goals: A short-term debt fund is a potent tool for investing to meet short-term financial goals. Due to the low average maturity period of underlying securities, the funds are resistant to price volatility due to adverse interest rate movements to a significant extent.
Steady Returns: The fund portfolio comprises debt securities that offer an assured rate of return along with scheduled principal repayments. These securities are not impacted by interest rate fluctuations if held till maturity.

Fund House Details

ICICI Corporate Bond Fund is part of the Fund House, ICICI Prudential Mutual Fund - a Trust. SEBI registered, ICICI Prudential Asset Management Company Limited (AMC) is the investment manager of all the schemes under ICICI Prudential Mutual Fund. The fund has a diversified product basket of over 68 schemes with active investors exceeding 60 lakhs across 300 locations in India.

The promoter shareholders of the Fund House are:

ICICI Bank: 51% holdings
Prudential Plc: 49% holdings

Who Should Invest in ICICI Prudential Short Term Debt Fund?

ICICI Prudential short term debt fund is suited for investors with an investment horizon of 1 to 3 years. One may expect to earn returns more than a bank fixed deposit in a rising interest rate scenario. A short-term rise in interest rate may temporarily impact the returns generated by a short-term debt fund.

In Conclusion

Considering the benefits of steady returns and smaller duration of the portfolio, ICICI Prudential short term debt fund is an ideal substitute to bank fixed deposits for investors looking for steady returns over a 1 to 3 year period.

FAQ's

Q. Is ICICI Prudential Short Term Debt Fund a good tool for long-term wealth creation?

Ans: The fund’s objective is to earn steady returns over a medium-term period. Contrary to equity funds, returns from a short-term debt fund are generally not significantly greater than inflation. A short-term debt fund is not suitable for long-term build wealth creation.
Q. Should I invest in ICICI Prudential Short Term Debt Fund as a lump sum or by way of a SIP?

Ans: An investor who is looking to invest money for a period of 1 to 3 years is advised to invest in ICICI Prudential Short Term Debt Fund as a lump sum as it is a fixed income fund, which looks to generate steady returns through investments in a portfolio of debt instruments with a duration between 1 year and 3 years.
Q. Is ICICI Prudential Short Term Debt Fund a high-risk investment?

Ans: Being a short-term debt fund, the fund primarily invests in short-term government securities and debt securities of companies with a proven credit track record. While one may risk witnessing volatility in NAV in the short term, the fund is a good option for a 1-3 year investment horizon.
Q. What are the income tax implications of money earned from the ICICI Prudential Short Term Debt Fund?

Ans: Suppose any of the fund units are redeemed within 3 years from the date of investment. In that case, the capital gains are added to the investors' taxable income, and income tax is payable as per the applicable slab rate. If the fund units are sold after 3 years from the investment date, then capital gains are taxed @20% after considering indexation. IDCW distributed as a dividend will be taxable in the investor's hands as per slab applicable tax rates.

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~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
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^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.

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Period	Returns Per Year (Annualized)
6 Months	1.63%
1 year	5.33%
2 years	8.35%
3 years	8.54%
5 years	7.88%
10 years	8.56%
Since Inception	8.11%

ICICI Prudential Short Term Debt Fund

Investment Facts

Investment Objective

Fund Summary