The fund beat the category average by a margin of 1.13 per cent and was the third best performer among liquid plus funds. To add to its appeal, the expense ratio of 0.35 puts it amongst the lowest in the category. The fund had a poor start. In the December 2007 and March 2008 quarters, it underperformed the category average. Since then, it has beaten the category average every quarter.
Although the fund tends to have a low average maturity which is less than a year, it moved up to 9.72 months in March 2009 from around 15 days in the previous month. Currently it is around 4 months (September 2009).
The fund largely invests in Certificate of Deposits (CDs) and Commercial Paper (CP) and also takes exposure to privately placed debt instruments. The fund manager does not hesitate in taking huge positions to generate the extra return. For instance, the CP of Sundaram Finance accounted for 76 per cent of the portfolio (February 2009) while the CP of ICICI Securities Primary Dealership accounted for around 70 per cent (April 2009).
