ICICI Prudential Flexible Income Plan

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ICICI Prudential Flexible Income Plan is an open-ended mutual fund investment scheme which seeks to generate income for its investors by investing in a wide range of debt and money market instruments. Further, this mutual fund looks to invest in securities of varying maturities with the intention of boosting income while maintaining the ideal balance of yield, safety, and liquidity. Launched in September 2002, this mutual fund investment is one of the best investment options and specially designed for the low-risk investor whose primary objective is capital appreciation coupled with decent returns on investment. It’s also an apt investment for individuals who prefer funds with lesser volatility and want a regular income along with the flexibility of withdrawing anytime. The minimum investment amount for investing in this fund scheme is Rs. 5000.

This scheme ranks amongst the top mutual funds in India and is currently ranked third in the ‘Ultra Short-Term Debt’ category by CRISIL for the first quarter of financial year 2017-18 ended in June which remains unchanged from the previous quarter. Additionally, the fund boasts of a Morningstar Analyst Rating of Silver which has been upgraded from Bronze. This fund is currently being managed by fund manager extraordinaire, Rohan Maru who’s been shepherding the fund management team since September 2013. With over eight years of solid experience in the field of daily cash management and liquidity analysis of fixed-income funds, we feel Mr. Maru is the right man in charge. He’s ably supported by Rahul Goswami who joined in September 2012 and has been presiding over the overall investment process while also contributing towards forming a macroeconomic view.

This scheme has been a consistent performer and has performed better than others in its category. It’s perfect for investors looking to park their money till they decide what to do with it without taking undue risk. The management team makes use of a research-driven, bottom-up approach to strategically deploy funds in the debt markets to take advantage of interest rate risks. The team also actively scouts for situations in which non-fundamental reasons may lead to the mispricing of securities which they can take advantage of. Further, open communication channels between the team members help facilitate generation of ideas and ensure that the team makes an investment only after conducting thorough research and analysis.

This mutual fund investment is ideal for investors who are keen on adopting a safety-first approach where there no fear of losing money as the team looks to invest mainly in AAA or equivalent-rated securities, thus placing a higher emphasis on safety and liquidity. The fund thus provides the potential for investors to earn a total return from both interest and capital gains. Additionally, the fund manager tends to look out for the macroeconomic scenario, liquidity conditions, spreads, and other various short-term factors that can impact the asset allocation and maturity profile.

The fund also tends to maintain a shorter duration strategy thus protecting it from any market volatility. This makes this mutual fund perfect for risk-averse investors who tend to be concerned about wide fluctuations in the principal value of their bond holdings. However, if the manager expects interest rates to fall, the average duration of the portfolio could be increased in order to get the maximum benefit from the change while also taking into consideration the safety and liquidity factors. The fund’s superior risk-adjusted return also lays testimony to the team’s meticulous execution of this strategy. We believe that the fund will continue performing well in this category as the management team rank well on both the duration as well as credit management front.

This fund is suitable for investors looking for a short-term savings solution while looking to earn higher than Fixed Deposit returns without the risk of losing money. Furthermore, the
lower expense ratio makes this fund an attractively priced proposition. If you’re looking for an experienced team of financial advisors who give genuine and well-thought-out advice that can help meet your financial goals, you can approach us for tailor-made investment plans.