Short Duration Funds relatively stand out as an appealing option for a moderate period of 12 to 18 months
MUMBAI, Jan 17 (The CONNECT) – Union Mutual Fund has marked its entry in the Short Duration Fund – Debt Fund category with the launch of Union Short Duration fund -an open-ended short-term debt scheme investing in instruments such that the Macaulay duration of the portfolio is between 1 Year to 3 Years.
Debt Funds including Short Duration funds, in addition to, accrual returns offer the potential for mark-to-market gains when interest rates decline. Short Duration Funds relatively stand out as an appealing option for those seeking to invest in debt and money market securities for a moderate period of 12 to 18 months.
As per AMFI data, Short Duration Funds currently has 23 schemes with Net Assets Under Management of Rs 113,266 crores as on December 31, 2024. Basis SEBI guidelines, these funds maintain a Macaulay Duration between one and three years, which aims to maintain low to moderate sensitivity to interest rate fluctuations.
The Union Short DurationFfund will be managed by Anindya Sarkar and Shrenuj Parekh.
The significant strengthening of the dollar has put pressure on the Indian Rupee which in turn has tightened systemic liquidity prompted by Reserve Bank of India’s forex measures. This has led to elevated yields and spreads thus providing investors with an opportunity for higher accrual by investing in high yield assets, the fund house said.
