The underlying investment philosophy of this fund is to generate regular income and opportunities for capital appreciation while maintaining liquidity through active management of a diversified portfolio comprising of corporate bonds and securities across the investment grade credit rating and maturity spectrum.
The Scheme is an actively managed debt fund wherein the AMC takes an active view of the interest rate movements, liquidity conditions and other macroeconomic factors affecting interest rates. The scheme would seek to identify and invest in quality credits that offer an attractive risk-return reward relative to sovereign instruments with the objective to generate accrual income or in yield pickups which offer a better spread for similar credits. Potential capital appreciation opportunities arising out of mispricing of yields relative to fundamentals, potential credit upsides (both short term and long term ratings), sector rotations etc. will be explored.
Namdev Chougule - Head of Fixed Income, JPMAM India said, “With growth bottoming out, credible central bank, great macro stability and strong political mandate, in our view, the Indian economy is at the Inflection point. Tighter fiscal and monetary policies, the lagged impact of weaker growth and a more investment-led and less demand-led growth should be able to correct India’s macroeconomic imbalances i.e. gradual disinflation and slower and stable GDP growth. The disinflationary trend in the economy should bode well for monetary easing and may lead to a trend of falling interest rates in medium term. We believe, the rates across the curve could fall meaningfully over the next 18 to 24 months. This is certainly an opportune time for debt investors.”
Elaborating on the NFO, Nandkumar Surti, MD&CEO, JPMAM India said, “The biggest challenge always is that most investors tend to look at past returns before making an investment decision, rather than having a futuristic view. The biggest positive for debt markets unlike equity is that the Central Bank itself is focused on minimizing volatility as it directly impacts economic activity. Investors must understand that volatility is temporary in bond markets. Therefore, my suggestion to all investors is to take a slightly longer term view. Our Corporate Debt Opportunities Fund will benefit investors as it is poised to take advantage of the current economic reforms and improvement in credit rating in medium term.”