VR Logo

Birla Cash Plus

Birla Cash Plus has been a consistent performer despite its growing size. The fund is a good short-term investment vehicle for its quality orientation and active management.

The first short-term debt fund, Birla Cash Plus (BCP) has been a consistent performer over its tenure. Aiming at stable returns with liquidity and minimal risk - the key drivers for a short-term debt fund, BCP has closely tracked its benchmark JP Morgan Treasury Index. With a minimum investment of Rs 10,000, the fund is available on a no-load basis.

The fund invests in a mix of commercial papers, treasury bills and high quality debentures besides holding a chunk of the corpus in call money. Investment in corporate instruments is aimed at picking up yield since they typically pay a higher coupon than money market securities. Also, these bonds are shielded from interest rate risk since they have a residual maturity of 3-4 months, says the fund manager. Further, with active management, the fund shuffles across instruments of varying tenor, in accordance with the changes in interest rate outlook. In the current calendar, the fund has maintained an average maturity of around 3 months, in line with the soft interest rates. In its tenure of nearly four years, BCP has capitalised on higher call money rates during short-term liquidity constraints apart from earning interest income from corporate papers. A marginal exposure to treasury bills in times of falling interest rates has helped the fund rake in higher returns during rising markets.

Birla Cash Plus has been a consistent performer despite its growing size. The fund is a good short-term investment vehicle for its quality orientation and active management.