After languishing at the bottom of the ladder, in 2009 it picked up in performance. In the last two years, it has been amongst the top three performers in this category. Once its performance began to get noticed, the asset base began to rise and in December 2010 crossed the Rs 10 crore level for the first time in five years. The strategy of this dynamic bond fund is to actively manage duration in the most liquid segment of the market - be it government bonds, corporate bonds or money market securities. So one should not be surprised to see the portfolio radically change from being fully invested in high duration securities to an almost 100 per cent cash position. In fact, in 2009, the fund was almost 100 per cent into cash and cash equivalents for the entire year barring the last month. In November 2010, the average maturity stood at 11.53 years (category average: 4.49 years). Expenses are maintained at a lower level though fund manager changes are frequent.
This article was originally published on March 30, 2012.
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