IDFC Gilt Fund

Fund in Brief

IDFC Gilt Fund has been operating in the market for nearly 20 years intending to help investors achieve promised returns by investing funds in marketable securities. IDFC Gilt Fund prioritizes getting investors optimal returns with a guaranteed return of capital amount. It also maximizes liquidity by investing in government securities.

IDFC Gilt Fund offers two kinds of plans:

• IDFC Gilt Fund Investment Plan 
• IDFC Gilt Fund Constant Maturity Plan (earlier known as short term plan)

These two plans are further categorized into two plans:

• Regular plan
• Direct plan

These two variants are further sub-categorized as:

• Growth plan 
• Income Distribution and Cash Withdrawal Plan (IDCW)
• Quarterly Income Distribution and Cash Withdrawal Plan (IDCW)
• Annual Income Distribution and Cash Withdrawal Plan (IDCW)
• Periodic Income Distribution and Cash Withdrawal Plan (IDCW)

IDFC Gilt Fund regular plan and Direct Plan are offered under two categories:

1. Growth option

   Under Growth options, dividends are not declared. Instead, the income earned is attributed to the units, and they remain invested in the fund and reflect on Net Asset Value (NAV). 

2. Dividend option

   Under this option, the fund house tries to declare the dividends whenever the fund deems fit or at the time of foreclosure of the fund. On the other hand, if the dividends are not declared, the income remains invested and reflects on the Net Asset Value (NAV). 

   If the declared dividends are paid to the unit holders whose names appear on the registry, then the unitholders have the option of choosing one of the following categories under the dividend option:

   • Dividend payout facility: Under the dividend payout facility, income attributed to the dividend will be paid to the unit holders during the scheme's tenure. The amount payable to the unitholders will be Rs 100 or less than a folio per unit.
   • Dividend reinvestment facility: Under dividend reinvestment facility, those unitholders who have received dividends during tenure can choose to reinvest the income in the funds. However, it should be done before the foreclosure. The dividends of those unitholders who do not get paid during the term will automatically get reinvested.
   • Dividend sweep option: Under this, unitholders get the option to reinvest their declared dividend into any other schemes by IDFC Mutual Fund.

 IDFC Gilt Fund Facts

Investment Objective

IDFC Gilt Fund prioritizes generating optimum income for the individuals who are investing. In addition, this scheme maintains liquidity by investing in government debt securities across all maturities. 

Fund Summary

IDFC Gilt Fund investment plan direct plan-growth:

• Risk: Moderate
• Expense Ratio as of August 31, 2021: 0.62%
• Net Asset Value (NAV): Rs 29,9186 on September 03, 2021
• Returns: 1 year
• Compound Annual Growth Rate (CAGR): 11.5% (Past 3 Years)

IDFC Gilt Fund constant maturity plan direct plan-growth:

• Risk: Moderate
• Expense Ratio as of August 31, 2021: 0.62%
• Net Asset Value (NAV): Rs 37,0312 on September 03, 2021
• Returns: 1 year
• Compound Annual Growth Rate (CAGR): 12.7% (Past 3 Years)

Fund Returns Summary

1. IDFC Gilt Fund investment plan direct plan-growth return

   Tenure	Annualized Income
   1 Year	4.4%
   3 Years	11.5%
   5 Years	8.7%
   10 Years	9.8%
   Since Inception	8.5%

   *Returns are subject to change.

   *The investment risk in the investment portfolio is borne by the policyholder.

2. IDFC Gilt Fund constant maturity plan direct plan-growth returns

   Tenure	Annualized Income
   1 Year	4.6%
   3 Years	12.7%
   5 Years	10.1%
   10 Years	9.8%
   Since Inception	6.9%

   *Returns are subject to change.

   *The investment risk in the investment portfolio is borne by the policyholder.

Pros and Cons

Benefits of investing in IDFC Gilt Fund

There are multiple benefits of investing in the IDFC Gilt Fund. Let's see one by one what investors avail when they invest in it:

1. Low-risk funds

   IDFC Gilt Fund invests in the Government of India's debt securities and hence, the investor's savings are less likely to be defaulted because of the government of India backing it.

2. Good performance

   IDFC Gilt Fund has shown good and consistent performance since its inception. The fund has been able to fulfil its objective of maximizing returns for the investors.

Fund house details

IDFC Mutual Fund is the ninth-largest fund house in India by its asset size, and it has experience of over two decades. IDFC Mutual Fund is promoted by IDFC Limited, a renowned company formed by the Government of India as the country's finest infrastructure finance company. IDFC Mutual Fund enables investors to invest smartly through a wide range of innovative and high-quality investment solutions. 

The main goal of IDFC Mutual Fund is to cater to the investors by providing them dynamic schemes with wide-ranging categories to create long-term value for them. In addition, the Fund house tries to be transparent with the customers in its endeavours hence, gaining more trust.

Who should invest in IDFC Gilt Fund?

Following people should consider investing in the IDFC Gilt Fund:

• It is ideal for all individuals looking for a marginal increase in returns without losing their capital.
• IDFC Gilt Fund is a moderate to low risk fund. So you can invest in these funds without having much knowledge about the market and the risk related to it. Also, if you want to avoid risks involved in mutual funds.
• It is suitable for those who have no issue investing in debt-based funds.

In conclusion

The IDFC Gilt Fund is a safe investment option, suitable for people with a low-risk appetite. It offers security to the invested money by focusing its investments in government securities. Admittedly, the returns may not be as high as what a high-risk equity fund might offer. However, investors can rest assured that they won't lose their invested capital.

FAQ's