Bandhan US Treasury Bond 0-1 year Fund of Fund
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Why US Sovereign Securities are essential for Global Allocation
US is an S&P AA+/Fitch AAA rated country vs India sovereign rated as BBB-
The rise in yields offer decent potential returns to investors
US is the world’s largest economy, with the world’s most dominant reserve currency
With concerns emerging on global economic growth, a rise in risk-off sentiment is being witnessed, favoring US bonds over other economies’ bonds and equities
Opportunity in 0-1 year segment
The US yield curve (Inverted yield curve) is relatively attractive in the 0 to 1-year maturity bucket.
Source: Bloomberg, Data as on 31st January 2023. Past performance is not an indicator of future performance.
Lower Differential between India and US yield
1-year US treasury yield has moved up from 0.72% to 4.65% in the last 1 year.
Consequently, spread between US and India has compressed from ~390bps to ~227bps making the US exposure relatively more attractive.
Source: Investing.com and Bandhan internal analysis. Data as on 31st Jan 2023.
Merits of 0-1 year US Treasury Investment
A defensive portfolio allocation to balance equity risk, or to reduce interest rate sensitivity
Benefit from the relatively lower volatile short duration investment
Invest in the relatively high-quality US asset - Sovereign securities
Build fixed income asset in a dominant international reserve currency
Liquid, low cost beta exposure to short-dated dollar-denominated US government bonds
Who can invest?
Seeking to capture the current high yield of the US treasury, optimising the investment opportunity provided by the historic low levels of yield differential between the US and India sovereign bonds
Creation of USD asset
With limited duration sensitivity, intending to create a USD asset for funding a near term or defined expense without wanting to take any equity market linked volatility
Benefit from currency depreciation
Looking to gain dual exposure i.e. US treasury plus USD INR currency movement. Any further depreciation in the INR is expected to enhance returns (However, If INR appreciates it could have adverse effects)
Make an informed decision. Learn more about investing in Bandhan US Treasury Bond 0-1 year Fund of Fund.
Type of Scheme
An open ended fund of fund scheme investing in units / shares of overseas Index Funds and / or Exchange Traded Funds which track an index with US treasury securities in the 0-1 year maturity range as its constituents
The investment objective of the Scheme is to provide long-term capital appreciation by passively investing in units / shares of overseas Index Funds and / or ETFs which track an index with US treasury securities in the 0-1 year maturity range as its constituents, subject to tracking error. However, there can be no assurance that the investment objective of the Scheme will be realized.
0.25% of applicable NAV - if the units are redeemed/switched out within 1 month from the date of allotment
Nil – if the units are redeemed / switched-out after 1 month from the date of allotment
10th March to 23rd March 2023
During New Fund Offer
And in multiples of Re. 1/- thereafter
Regular/ Direct Plan: Growth Option and Income Distribution cum capital withdrawal Option^
Mr. Sreejith Balasubramanian (Overseas portion) Mr. Brijesh Shah (Debt portion)
Underlying Fund & Benchmark
Underlying Fund: JPMorgan ETFs (Ireland) ICAV - BetaBuilders US Treasury Bond 0-1 year UCITS ETF^^
Benchmark: ICE 0-1 Year US Treasury Securities Index
^ the amounts can be distributed out of investors capital (Equalization Reserve), which is part of sale price that represents realized gains. Read Scheme Information Document for more details.
^^ Bandhan US Treasury Bond 0-1 year Fund of Fund reserves the right to change the underlying fund as mentioned in the SID.
Mr. Sreejith BalasubramanianVice President – Fixed Income
Mr. Sreejith Balasubramanian joined the Fixed Income team of IDFC AMC on November 20, 2017. He is currently acting as a Vice President - Fixed Income with primary responsibility of economic research. He was earlier associated with Cognizant Technology Solutions Ltd. as Research Manager from March 2010 to November 2017 and his primary responsibility was Macroeconomic research.
Bandhan US Treasury Bond 0-1 year Fund of Fund
(An open ended fund of fund scheme investing in units/shares of overseas Index Funds and/or Exchange Traded Funds which track an index with US treasury securities in the 0-1 year maturity range as its constituents)
The product is suitable for investors who are seeking*:
- To create wealth over long term
- Generate returns through investing in US treasury securities in the 0-1 year maturity range
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them
The identity of the issuer of the Promotion Material and the investment product which is the subject of the Promotion Material and the content of the Promotion Material has been verified by the issuer thereof; The Promotion Material is not issued by J.P. Morgan Asset Management (Singapore) Limited (JPMAMSL), any of its Affiliates or a JPMorgan Fund and the Promotion Material does not relate to a direct investment in any JPMorgan Fund; neither JPMAMSL, any of its Affiliates or a JPMorgan Fund has reviewed the contents of the Promotion Material and accordingly takes no responsibility for the accuracy of the contents of the Promotion Material or any liability for any statement or misstatement in the Promotion Material; and an investor would be investing into an investment product which is established, offered and sold by the Company or its Affiliates and would not be investing in any JPMorgan Fund, and accordingly there is no contractual relationship between the Investor and JPMAMSL, any of its Affiliates or a JPMorgan Fund. Investors will bear the recurring expenses of the Scheme in addition to the expenses of the underlying schemes in which investments are made by the Scheme. Bandhan US Treasury Bond 0 to 1 year Fund of Fund is not a dedicated Feeder fund and investment in underlying fund will be undertaken subject to fulfilment of documentation and regulatory requirements applicable for investing in the underlying fund. The FoF performance is subject to the movements of the underlying fund. IDFC AMC (proposed to be changed to Bandhan AMC Limited, awaiting registration) does not have an active role in managing the underlying fund. The Bandhan US Treasury Bond 0 to 1 year Fund of Fund can invest only in similar mutual fund/s or exchange traded fund/s with similar investment strategy, similar investment objective, similar asset allocation, similar benchmark.