March 23, 2024
mayank
HSBC Arbitrage Fund details, NAV, Portfolio, Returns, Peer Comparison, Fund Managers & Guidance by Chanakyamfguidance.com
NAV Growth: Rs 18.4960
Quarterly NAV IDCW: Rs 11.4599
Monthly NAV IDCW: Rs 10.6361
Suitable For Which Investors?
“Arbitrage funds invest in equity shares and derivatives, and earn their returns through the price differential between a stock and its futures. You can expect to earn better returns than what you would get from a bank account.
They are usually suitable to park your money for a period ranging between three months to a year. However, we believe that liquid funds, which have a similar risk-return payoff, are a better alternative for most investors for such a time frame. Arbitrage funds may have some appeal for those who are in the highest tax bracket, given the preferential tax treatment of these funds.
The risk of incurring a loss in these funds over the said time frame is low but they do not guarantee returns or safety of capital.
Remember, these funds usually deliver low returns which are only marginally higher than your bank account. They are not suitable if your aim is to build wealth in the long run.”
Fund’s Investment Strategy:
The scheme seeks to generate reasonable returns by predominantly investing in arbitrage opportunities in the cash and derivatives segments of the equity markets and by investing balance in debt and money market instruments.
Fund Manager:
1) Praveen Ayathan
Education: Mr. Praveen is a B.Sc (Mathematics).
Experience: Prior to joining HSBC Mutual Fund, he has worked with L&T MF, Kotak Mahindra AMC and Dalal & Broacha Stock Broking Pvt. Ltd.
2) 2) Mahesh A Chhabria
Education: Mr. Chhabria is a Commerce Graduate and has also pursued FCA and CFA.
Experience: Prior to joining HSBC MF, he has worked with L&T AMC, Edelweiss Securities Ltd, Darivium Traditions Pvt. Ltd. and FIL Fund Management Pvt. Ltd.
3) Hitesh Gondhia
Investment Details
| Min. Investment (Rs) | 5,000 |
| Min. Addl Investment (Rs) | 1,000 |
| Min. SIP Investment (Rs) | 500 |
| Min. Withdrawal (Rs) | 500 |
| Min. No of Cheques | 12 |
| Min. Balance (Rs) 500 | |
| Lock-in Period | NA |
| Exit Load | 0.25% for redemption Within 1 month |
Basic Details
| Fund House | HSBC Mutual Fund |
| Launch Date | 30-Jun-14 |
| Return Since Launch | 6.52% |
| Benchmark | NIFTY 50 Arbitrage TRI |
| Riskometer | Low |
| Type | Open-ended |
| Assets | Rs 2,012 Cr |
| (As on 29-Feb-2024) | |
| Expense | 0.27% |
| (As on 29-Feb-2024) | |
| Risk Grade | Average |
| Return Grade | Average |
| Turnover | 343.00% |
Trailing Returns (%) of HSBC Arbitrage Fund
| Fund name | YTD | 1D | 1M | 3M | 6M | 1Y | 3Y | 5Y | 7Y | 10Y |
| HSBC Arbitrage Dir | 1.95 | 0.01 | 0.58 | 2.10 | 3.96 | 8.19 | 5.93 | 5.84 | 6.07 | — |
| CCIL T Bill Liquidity Weight | 1.05 | 0.01 | 0.39 | 1.13 | 2.29 | 4.70 | 3.23 | 3.28 | 3.53 | — |
| Hybrid: Arbitrage | 1.92 | 0.02 | 0.56 | 2.09 | 3.91 | 8.07 | 5.88 | 5.66 | 5.88 | — |
| Rank within category | 15 | 19 | 10 | 16 | 14 | 14 | 15 | 7 | 7 | — |
| Number of funds in category | 27 | 27 | 27 | 27 | 26 | 25 | 24 | 21 | 16 | 9 |
Peer Comparison of HSBC Arbitrage Fund
| Rating | 1 Year Returns | 3 Year Returns | 5 Year Returns | Expense Ratio (%) | Net Assets (Rs Cr) | Return Since Launch (%) | Exit Load (Days) | Fund Age | Turnover (%) | |
| HSBC Arbitrage Dir | 3 star | 8.19 | 5.93 | 5.84 | 0.27 | 2,012 | 6.52 | 0.25 (30) | 9Y 8M | 343.00 |
| Kotak Equity Arbitrage Dir | 4 star | 8.50 | 6.30 | 5.97 | 0.43 | 39,099 | 7.02 | 0.25 (30) | 11Y 2M | 2013.85 |
| Invesco India Arbitrage Dir | 5 star | 8.44 | 6.41 | 6.04 | 0.37 | 14,593 | 6.86 | 0.50 (15) | 11Y 2M | 1820.00 |
| Nippon India Arbitrage Dir | 4 star | 8.30 | 6.16 | 5.93 | 0.39 | 13,854 | 7.04 | 0.25 (30) | 11Y 2M | 1054.00 |
| ABSL Arbitrage Dir | 4 star | 8.28 | 6.10 | 5.85 | 0.34 | 10,668 | 6.90 | 0.25 (15) | 11Y 2M | 1548.00 |
Portfolio Analysis of HSBC Arbitrage Fund
| No. of Stocks | 112 |
| Top 10 Holdings | 37.99% |
| Top 5 Stocks | 24.79% |
| Top 3 Sectors | 43.09% |
| Portfolio P/B Ratio | 2.73 |
| Portfolio P/E Ratio | 19.78 |
Portfolio Breakup
| Fund | Category | |
| Average Mkt Cap (Rs Cr) | 1,09,738 | 1,77,710 |
| Giant (%) | 31.29 | 47.84 |
| Large (%) | 31.35 | 28.56 |
| Mid (%) | 31.81 | 23.01 |
| Small (%) | 5.54 | 1.76 |
| Tiny (%) | — | — |
| Fund | Category | |
| Number of Securities | 122 | 195 |
| Macaulay Duration (yrs) | 0.42 | 0.31 |
| Average Maturity (yrs) | 0.42 | 0.31 |
| Yield to Maturity (%) | 7.36 | 7.27 |
| Avg Credit Rating | AAA | — |
How to Invest in HSBC Arbitrage Fund?
Chanakya’s Mutual Fund Guidance For HSBC Arbitrage Fund
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