With 11.21% Annualised Returns In 2 Years, This Income Optimizer Fund Outperformed Benchmark

Hybrid Funds make investments across a range of asset classes. Although some funds contain other asset classes like gold, international equities, etc. in their portfolio, the majority of hybrid funds invest in equity and debt. Through a balanced portfolio, hybrid funds seek to increase wealth over the long term and produce income in the short term. With just one fund, hybrid funds let you build a diverse portfolio. For objectives, you hope to reach in three to five years, invest in them.

Here, we have highlighted one such fund (FoF), ICICI Prudential Income Optimizer Fund (FOF). This fund has outperformed the category average in the short-term period and has also given good returns on SIP investments. Let's dig in to know more about the fund.

 ICICI Prudential Income Optimizer Fund (FOF)

ICICI Prudential Income Optimizer Fund (FOF) is a conservative hybrid Fund of Fund (FoF) mutual fund scheme launched by the ICICI Prudential Mutual Fund. It is an open-ended and moderate risky fund (FoF). The fund's Direct Plan-Growth option was launched 9 years ago on April 05, 2013. 

Under the Direct Plan Growth Option of the fund, its assets under management (AUM) are Rs 263.59 crore. The expense ratio of the fund is 0.07%, which is less than its category average expense ratio of 0.55%. Its Net Asset Value (NAV) declared on July 26, 2022, is Rs. 46.798.

It has been rated 4-star by Value Research, however, it is not rated by CRISIL, a Mutual fund rating agency. The fund has delivered positive returns over the 2 years compared to category average rates and outperformed the benchmark. Its benchmark is CRISIL Composite Bond Index (65%) + NIFTY 50 Index (35%).

The Fund seeks to generate regular income by predominantly investing in debt-oriented schemes. The Scheme will also invest in equity-oriented & hybrid-oriented schemes with an aim to generate capital appreciation. 

 

Minimum Amount Required

To begin investing, the minimum amount required for lump sum payment is Rs 5,000 and for SIP it is Rs 500, respectively. For additional investments, the fund requires a minimum required amount of Rs 1,000.

It has no Lock-in period, however, it charges 1% on redemption/exit within 365 days/1 year of the investments.

Annualised Returns

Lump Sum Investment
It has given an annual average return of 8.87% since its inception, which is almost double its category annual average return of 4.73%.

1-Year	2-year	3-year	5-Year
4.66%	11.21%	8.99%	8.03%

SIP Investment Returns

1-Year	2-year	3-year	5-Year
3.24%	7.41%	9.15%	8.77%

Portfolio

As the fund is a conservative hybrid Fund (FoF), its investments are in both Equity and Debt instruments. However, in debt, its major investments are in ICICI Prudential Floating Interest Direct-Growth (69%) & ICICI Prudential Medium Term Bond Direct-Growth (2.38%) mutual funds. Credit Rating vis-à-vis Category majority are in SOV, AAA, AA, and cash equivalent.

The fund has major equity investments are in the Financial sector followed by Technology, Energy, Communication, Healthcare, Automobile, Services, Insurance, Construction, Metals & Mining, Capital Goods, Consumer Staples, Materials, Chemicals, Textiles, and Consumer Discretionary.

The top equity holdings of the fund include ICICI Prudential Export & Services Direct-Growth, ICICI Prudential Equity & Debt Direct-Growth, and ICICI Prudential Value Discovery Fund-Direct Plan.

Disclaimer

Mutual funds investment are subject to market risks. Read all scheme related documents carefully before investing. Greynium Information Technologies, and the Author are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.