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Axis All Season Debt FoF: New Fund Review

"Axis All Seasons Debt Fund FOF is a unique product in the debt basket. It aims at adequate diversification. Especially at this point when there is a lot of confusion among investors about debt funds, this can be a go to scheme."

, ET Online|
Last Updated: Jan 20, 2020, 11.35 AM IST
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Axis Mutual Fund has launched Axis All Season Debt FoF, a debt fund of fund. The new fund offer (NFO) closes for subscription on 22nd January. The All Season Debt FoF will invest in funds across fund houses and different categories of the debt market to generate optimal returns over the medium term. The FoF will be manged by R Sivakumar, Head-fixed income, Axis Mutual Fund.

Basic feature of the scheme
Minimum Investment: Rs 5,000
Exit Load (%): For units in excess of 10% of the investment, 1% will be charged for redemption within 365 days
Benchmark: NIFTY Composite Debt TRI

As you can see, the new scheme will invest in different debt schemes across fund houses to generate better medium-term returns. Should you invest in it?

Neeraj Chauhan, CEO, The Financial Mall, a Delhi-based wealth management firm:
Axis All Seasons Debt Fund FOF is a unique product in the debt basket. It aims at adequate diversification. Especially at this point when there is a lot of confusion among investors about debt funds, this can be a go to scheme. However, I believe we don't have enough success stories of FOFs to back this new product. Another point here is that FOFs generally have a higher expense ratio. Debt funds generally have lower returns, add to that a more diversified and high expense scheme. We expect lower risk and lower returns from this FOF. This might not be suitable for short-term investors. So, I wouldn't recommend this scheme at this time.

SR Srinivasan, Founder, SriNivesh, a Bangalore-based wealth management firm:
The SID of the scheme is very generic and gives no information about how the fund will actually work. In absence of that it is difficult to take a call. I believe it is a unique offering from a fund house which hasn't made its mark in the debt space like they have in equity. For equity investors who want a little cushion of stability from debt, this can prove to be a one-stop fund. In that case, they don't need many schemes to diversify in debt. I have hopes from this fund, but I don't think it will offer higher than usual returns. We will have to wait and watch on this one.
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