How to Become Financially Independent with SBI Credit Risk Fund?

After retirement, everyone concerns to get the income from such sources, which will help them in the long run. Therefore, the financial experts of MySIPonline suggest such investors to invest in the debt funds. One such fund, where the people who are in the age of retirement or have a moderate risk and want to invest in the debt securities, may invest in SBI Credit Risk Fund. The fund was earlier known as SBI Corporate Bond Fund but has changed the name due to SEBI’s re-categorization of mutual funds. So, if you are looking for the investment in the fund, have a look at the details listed below:

1. Investment Objective: SBI Credit Risk Fund aims at providing the long-term capital appreciation to the investors by predominantly investing in the debt instruments rated AA and below. To keep the moderate liquidity in the fund, it also invests its part of the corpus in the money market securities.

2. Fund Details: SBI Corporate Bond fund was launched in the year 2004 and have the AUM of Rs 5,268 Cr as on May 31, 2018. Its expense ratio is 1.50%. It offers the growth and dividend options under the regular and direct plan. Its portfolio comprises medium credit quality and sensitive interest rate debt instruments of the total 98 companies. The top five companies where the fund invests is Muthoot Finance, Sterlite Power Grid Ventures, Dalmia Bharat, Aditya Birla, and Essel Corporate Resources.

3. Fund’s Strategies: The fund follows the bottom-up approach, investing in the quality businesses who do not have excessive debt or negative earnings. The fund management team of fund analyse credit ratings of the companies selecting the top 320 companies. The risk management team also reviews the portfolio, for making essential changes if needed.

4. Past Performance Analysis and Risk Measures: SBI Credit Risk primarily invests in the high yielding securities. The fund has generated 7.67% since its launch. It has generated the alpha of 9.50% on the basis of the past three years returns as provided by the financial experts of MySIPonline. The trailing returns of the fund in the past three, five and seven years were 8.06%, 9.09%, and 9.23%. The three years return of the fund is less than its category, but higher than its benchmark Crisil Composite Bond Fund Index.

The annualized returns of the fund in the past years were good and outperformed in all the years. In the year 2014, the annualized returns were 10.62%, in 2015 was 9.71%, 2016 was 10.48% and 6.89% in 2017.

1. Fund Managers: Mr Dinesh Ahuja managed SBI Bond fund until January 2017. Now, it is managed by Mr Lokesh Mallya and Ms Mansi Sajeja since February 2017. Under Ahuja’s direction, the fund has crossed all the benchmarks, but under new fund managers, the fund still has to prove itself, as the fund has generated low returns in 2017 than its category.

Mr Mallya joined the SBI fund management in the year 2014. He has 9 years of experience in the Indian financial market and fixed income funds’ management. He is a Charter holder from CFA Institute, USA and also FRM Charter holder from Global Association of Risk Professionals (GARP).

Ms Sajeja joined SBI Fund Management in the year 2009. She is also Charter holder from CFA Institute, USA.

The NAV of SBI Credit Risk Fund G is Rs 28.0968 as on July 6, 2018. It offers the investment via SIP and lumpsum. The ideal investment horizon to invest in the fund is for 3 to 5 years. So, if you are looking for investment in the fund and require more details of the fund, connect with our experts at MySIPonline.