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In this video we review 2 of the best short-term debt funds, ICICI Short Term Debt Fund and HDFC Short Term Debt Fund. Both these funds are the best funds for short term needs. Short term debt funds invest in assets with maturities of up to 3 years, and in government securities (sovereign bonds) or high-quality corporate bonds. The credit risk on this category of debt mutual funds is usually very low.
The comparisons of ICICI Short Term Debt Fund and HDFC Short Term Debt Fund are as given below:
1. Assets Under Management (AUM) - HDFC Rs. 13,569 Crores vs ICICI Rs. 18,946 Crores
2. Expense Ratios – HDFC 0.74% vs ICICI 1.16% 3.
3 Year Returns – HDFC 8.64% vs ICICI 7.93%
4. Net Yield to Maturity (YTM) – HDFC 5.48% vs ICICI 4.67%
5. Asset Quality (in AA or below) – HDFC 14% vs ICICI 15%
6. Modified Duration – HDFC 2.77 vs ICICI 2.79
7. Minimum Lumspsum investment – Rs. 5,000 in case of both funds
8. Minimum SIP investment – HDFC Rs. 500 vs ICICI Rs. 1,000
9. Tax on Gains – Short term capital gains as per tax bracket.
Long term capital gains at 20% with benefit of indexation.
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