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Liquid Plus Funds Gain Despite MTM Norm

Barring three schemes, NAVs of most funds rose on the first day of new valuation norm

Most ultra short-term funds (earlier called liquid plus funds) posted a growth in their net asset values (NAVs) on the first day (August 2, 2010) of the new valuation norm for the securities held by them.

Earlier, the mutual fund industry was apprehensive of  a possible drop in NAVs of liquid plus funds due to implementation of the new norm just a few days after the Reserve Bank of India (RBI) hiked repo and reverse repo rates. Some fund houses had even requested the Securities and Exchange Board of India (SEBI) to extend the deadline for implementation of the new norm.
Bond prices usually drops after the hike in bank rates. RBI on July 27 increased the repo rate (the rate at which it lends money to banks) by 0.25 per cent and the reverse repo (rate at which it borrows from other banks) by 0.50 per cent.
Under the new valuation norm, debt funds with maturity up to 182 days will be valued at the average weighted market price (mark-to-market, or MTM) of the securities held by them on a particular day. The new valuation norm is likely to increase volatility in the day-to-day change of NAVs of such funds.
"Hike in policy rate was expected and the market had already factored in the possible impacts, and hence the drop in prices of securities held by ultra short term funds was not much,"said a fund manager.
The average change in NAVs of the ultra short term funds on August 2, 2010 was 0.0371 per cent over the previous day on July 30. JM Money Manager's NAV appreciated the maximum by 0.664 per cent during the day.

NAV change in Liquid Plus Funds
    NAV  
Funds  30/07/2010  02/08/2010  % change
Birla Sun Life Short Term Opportunities Ret 14.5572 14.5517 -0.0378
Birla Sun Life Short Term Opportunities Inst 10.6582 10.6542 -0.0375
DWS Money Plus Reg 13.4297 13.4302 0.0037
DWS Money Plus Inst 10.5424 10.5428 0.0038
DWS Treasury Investment Reg 10.4939 10.4943 0.0038
Edelweiss Short Term Bond Inst 11.2605 11.2610 0.0044
Edelweiss Short Term Bond Ret 11.2177 11.2182 0.0045
DSPBR Floating Rate 15.0348 15.0359 0.0073
DWS Treasury Investment Inst 10.5179 10.5187 0.0076
Principal Ultra Short Term Reg 12.0262 12.0272 0.0083
DSPBR Floating Rate Inst 1347.9393 1348.0623 0.0091
Sundaram BNP Paribas Income Plus 14.6089 14.6118 0.0199
Baroda Pioneer Short Term Bond 10.0229 10.0250 0.0210
IDFC Savings Advantage Plan F 10.1439 10.1468 0.0286
IDFC Money Manager Investment A 14.2935 14.2976 0.0287
IDFC Savings Advantage Plan D 10.5752 10.5783 0.0293
IDFC Money Manager Investment F 10.2057 10.2088 0.0304
IDFC Savings Advantage Plan A 1317.9642 1318.3672 0.0306
IDFC Money Manager Treasury D 10.4465 10.4498 0.0316
IDFC Money Manager Investment B 14.5761 14.5809 0.0329
JM Floater LT Regular 14.7360 14.7409 0.0333
JM Floater LT Premium 14.1907 14.1955 0.0338
Mirae Asset Ultra Short Term Bond Regular 1049.1466 1049.5099 0.0346
AIG India Treasury Ret 12.0325 12.0367 0.0349
ICICI Prudential Flexible Income Regular 106.3988 106.4362 0.0352
DWS Ultra Short Term Reg 15.2134 15.2188 0.0355
DWS Cash Opportunities Reg 12.4971 12.5016 0.0360
JM Money Manager Super Plus 13.2017 13.2065 0.0364
AIG India Treasury Inst 12.1472 12.1517 0.0370
Bharti AXA Treasury Advantage Ret 1121.0494 1121.4656 0.0371
Sundaram BNP Paribas Ultra ST Ret 12.3731 12.3777 0.0372
IDFC Money Manager Treasury A 15.0522 15.0578 0.0372
IDFC Money Manager Treasury F 10.2039 10.2077 0.0372
Birla Sun Life Savings Ret 17.3796 17.3861 0.0374
DWS Treasury Cash Reg 10.3825 10.3864 0.0376
AIG India Treasury Super Inst 12.1825 12.1871 0.0378
Tata Treasury Manager Retail 1240.2987 1240.7687 0.0379
SBI Short Horizon Debt Ultra ST Ret 12.0301 12.0347 0.0382
Tata Treasury Manager HI 1242.0375 1242.5185 0.0387
UTI Treasury Advantage 2374.3942 2375.3181 0.0389
Reliance Money Manager Retail 1265.0312 1265.5263 0.0391
ICICI Prudential Ultra Short Term Regular 10.4759 10.4800 0.0391
HSBC Ultra Short Term Bond Regular 12.7515 12.7565 0.0392
ICICI Prudential Ultra Short Term Prem 10.4433 10.4474 0.0393
Fidelity Ultra Short Term Debt Ret 11.9345 11.9392 0.0394
L&T Freedom Income Short-term 14.8020 14.8079 0.0399
DWS Ultra Short Term Inst 11.0181 11.0225 0.0399
Sundaram BNP Paribas Ultra ST Inst 12.5038 12.5089 0.0408
Tata Treasury Manager Super HI 1064.9244 1065.3588 0.0408
ICICI Prudential Flexible Income Premium 174.2651 174.3364 0.0409
SBI Short Horizon Debt Ultra ST Inst 12.1997 12.2047 0.0410
Birla Sun Life Savings Inst 17.7830 17.7903 0.0411
Bharti AXA Treasury Advantage Inst 1132.1046 1132.5711 0.0412
HSBC Ultra Short Term Bond Inst 12.8478 12.8531 0.0413
DWS Treasury Cash Inst 10.4039 10.4082 0.0413
IDFC Money Manager Treasury B 14.9736 14.9798 0.0414
Canara Robeco Treasury Adv Ret 15.3364 15.3428 0.0417
Canara Robeco Floating Rate ST 14.4637 14.4698 0.0422
Canara Robeco Treasury Adv Inst 15.3654 15.3719 0.0423
IDFC Money Manager Treasury C 11.1029 11.1076 0.0423
HDFC Floating Rate Income ST Retail 15.8182 15.8249 0.0424
Reliance Money Manager Inst 1276.2990 1276.8403 0.0424
Axis Treasury Advantage Retail 1019.1421 1019.5747 0.0424
DWS Cash Opportunities Inst 12.0082 12.0133 0.0425
Fidelity Ultra Short Term Debt Inst 11.6878 11.6928 0.0428
ICICI Prudential Ultra Short Term Prem Plus 10.4728 10.4773 0.0430
Fortis Money Plus Reg 13.9566 13.9626 0.0430
Peerless Ultra Short Term Retail 10.2064 10.2108 0.0431
L&T Freedom Income Short-term Inst 15.0737 15.0802 0.0431
UTI Treasury Advantage Inst 1258.0456 1258.5902 0.0433
Fidelity Ultra Short Term Debt Super Inst 12.1162 12.1215 0.0437
HDFC Cash Mgmt Treasury Adv Ret 20.3149 20.3238 0.0438
JP Morgan India Treasury Retail 11.1775 11.1824 0.0438
Shinsei Treasury Advantage 1041.0059 1041.4674 0.0443
Sundaram BNP Paribas Ultra ST Super Inst 12.6244 12.6300 0.0444
Fortis Money Plus Inst 14.1316 14.1379 0.0446
ING Treasury Advantage Regular 12.5166 12.5222 0.0447
Axis Treasury Advantage Inst 1038.3039 1038.7688 0.0448
Religare Ultra Short Term Inst 12.8798 12.8856 0.0450
Religare Ultra Short Term Retail 12.6443 12.6500 0.0451
Templeton India Ultra Short Bond Ret 11.9337 11.9391 0.0453
Canara Robeco Treasury Adv Super Inst 14.1382 14.1446 0.0453
ING Treasury Advantage Inst 12.5223 12.5280 0.0455
ICICI Prudential Ultra Short Term Super Prem 10.5219 10.5267 0.0456
HDFC Floating Rate Income ST Wholesale 15.9548 15.9621 0.0458
HDFC Cash Mgmt Treasury Adv Wholesale 20.5334 20.5428 0.0458
JP Morgan India Treasury Super Inst 12.2119 12.2175 0.0459
HSBC Ultra Short Term Bond Inst Plus 12.9871 12.9931 0.0462
Peerless Ultra Short Term Super Inst 10.1644 10.1691 0.0462
Templeton India Ultra Short Bond Inst 11.9965 12.0021 0.0467
Peerless Ultra Short Term Inst 10.2252 10.2300 0.0469
Baroda Pioneer Treasury Advantage Inst 10.5578 10.5628 0.0474
Baroda Pioneer Treasury Advantage Reg 10.5448 10.5498 0.0474
Reliance Floating Rate ST 14.7547 14.7617 0.0474
LICMF Savings Plus 14.8892 14.8963 0.0477
Religare Credit Opportunities Retail 10.4819 10.4869 0.0477
LICMF Income Plus 12.5771 12.5831 0.0477
Taurus Ultra Short Term Bond Retail 1091.1453 1091.6688 0.0480
Templeton India Ultra Short Bond Super Inst 12.0593 12.0651 0.0481
Religare Credit Opportunities Inst 10.5038 10.5089 0.0486
Taurus Ultra Short Term Bond Inst 1093.6977 1094.2315 0.0488
Taurus Ultra Short Term Bond Super Inst 1097.2039 1097.7484 0.0496
DSPBR Money Manager Ret 1285.2274 1285.8841 0.0511
JM Money Manager Super 13.1798 13.1867 0.0524
DSPBR Money Manager Inst 1302.1480 1302.8344 0.0527
Sahara Short Term Bond 10.7898 10.7955 0.0528
IDFC Ultra Short Term 12.8381 12.8451 0.0545
JM Money Manager Reg 12.8106 12.8191 0.0664
NAV in Rs