Learn About Mutual Fund

1. IDFC Floating Rate Fund
An Open-ended Debt Scheme predominantly investing in
floating rate instruments (including fixed rate instruments
converted to floating rate exposures using swaps/derivatives)

2. IDFC Floating Rate Fund is our offering in the Satellite bucket, for a minimum recommended
investment horizon of 6 months
Debt Allocation Framework
1 day 7 days 3 months 6 months
1 year
2 years 3 years 6 months 3 years +
IDFC
Overnight
Fund
IDFC
Cash
Fund
IDFC Ultra
Short Term
Fund
IDFC Money
Manager
Fund
IDFC Bond
Fund - Short
Term Plan
IDFC All
Seasons
Bond Fund*
IDFC Corporate
Bond Fund
IDFC Low
Duration
Fund
IDFC Banking
& PSU Debt
Fund
IDFC Bond Fund -
Income plan
IDFC Credit
Risk Fund
IDFC Dynamic
Bond Fund
IDFC Government
Securities Fund - IP
IDFC Government
Securities Fund - CMP
IDFC Bond
Fund - Medium
Term Plan
LIQUIDITY CORE SATELLITE
Minimum recommended investment horizon
Liquidity: For very short term parking of surplus or emergency corpus
Core: Ideally forms bulk of your allocation –Funds that focus on high credit quality and low
to moderate maturity profile
Satellite: Funds that can take higher risk –either duration risk or credit risk or both
IDFC Floating
Rate Fund
2
For IDFC All Seasons Bond Fund – IDFC All Seasons Bond Fund is a Fund of Funds Scheme. Investors may note that they will be bearing recurring expenses of the Scheme in
addition to the expenses of the underlying schemes in which the Fund of Funds scheme invests.

3. About the Fund
Relatively
Stable Returns
Portfolio of Floating rate debt, fixed
rate instruments swapped for
floating rate returns and other debt
& money market instruments
Minimum
recommended
investment
horizon of 6
months
Across Credit
spectrum,
including AT1
bonds
3

4. CREDIT QUALITY
There is no cap or floor prescribed for credit
quality. The credit quality stance would
depend on the market conditions.
Strategy
AVERAGE MATURITY
As per current proposed strategy, the portfolio maturity
would be positioned such that it is suitable for a
minimum recommended investment horizon of 6 months
The fund is proposed under the Satellite Bucket offering which means it will not run a constrained duration or
constrained credit risk strategies.
Currently the fund proposes to run a low to short duration risk profile with some allocation to sub AAA
strategies including Additional Tier 1 (Basel III) bonds of higher rated PSU/Private Banks.
However, currently the fund aims to maintain a minimum of 70% in AAA/A1+Equivalent/Sovereign/Quasi
Sovereign (at the time of investment). Further the fund does not aim to invest in securities rated lower than AA-
(at the point of investment).
4

5. Investors seeking
lower investment
horizon in Satellite
bucket
Who Should Invest?
Investors seeking
to diversify their
current fixed
income portfolio
Investors seeking
relatively stable
returns over a short
period of time
5

6. Floating Rate instruments (including fixed rate instruments
converted to floating rate exposures using swaps / derivatives)
Debt and Money Market Instruments other than Floating
Rate instruments
Units issued by REITs & InvITs
65% - 100%
0%-35%
0% - 10%
Low to Medium
Low to Medium
Medium to High
Indicative Allocation
Risk Profile
(as % of total assets)
Asset Class
Asset Allocation
6
REITs: Real estate investment trusts
InvITs: Infrastructure investment trusts

7. Risks
7
The fund follows a diluted credit strategy and therefore is positioned
in the Satellite bucket (has higher credit risk versus Core bucket)
The fund may invest in floating rate bonds or create synthetic floaters using Interest
Rate Swaps (IRS). This may not provide a complete hedge against interest rate rise owing to
basis risk, different tenor of swaps and bonds, amongst other factors
Any fixed income fund may be prone to credit risk, liquidity risk, interest rate risk,
re-investment risk, etc.

8. Swaps – An illustration
8
Overnight Index Swap (OIS) is a hedging contract between two parties, wherein the two parties exchange or
swap the interest payments for a notional principal amount. These contracts can involve fixed or floating rate
of interest. Here the floating leg of the swap is linked to an overnight index.
A mutual fund can use OIS to convert fixed interest rate to floating interest rate.
Illustration:
The fund invests INR 100cr in a 5 year bond at 6.27% and wishes to convert fixed interest rate to floating interest rate.
It can do so by paying a 5 year OIS of 5.32% on a notional value of INR 100cr and in turn receiving floating benchmark rate
i.e. overnight MIBOR (Mumbai Interbank Outright Rate). The floating leg of the transaction is compounded daily.
Data as on 25th Feb 2021
The above is only to illustrate working of OIS / bond swaps in funds. The illustration does not take into account various aspects such as accruals, expenses, market factors, etc.
Buy a Fixed Income Security
Pay OIS
(Fixed rate)
Receive Overnight rate
(Floating rate)
Enter a Swap

Receive Pay
6.27% 5.32%
Floating (overnight)

9. Why Now?
9
Following are some cyclical factors that could turn out to be potential tailwinds for us:
 Stress on banking balance sheet seems to be stabilizing as recognition and provisioning seem to be finally
ahead of formation.
 Manufacturing segment may get a boost from the corporate tax cuts announced earlier alongside a
robust production incentive scheme roll out, and improving global trade.
 Government revenues are likely to also see a cyclical upswing thus enabling a more robust spending
program ahead.
 Some revival in the real estate sector could feed into better employment prospects via a construction
cycle.
 Monetary policy is genuinely accommodative.
However, income slowdown cycle needs to be reversed and the elements of permanent damage to smaller
balance sheets need to be controlled for sustenance of a cyclical rebound.
Please refer our detailed Annual note here: https://idfcmf.com/article/3568

10. Product Label
Disclaimer:
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.
This product is suitable for investors who are seeking*:
 To generate short-term optimal returns
 To invest predominantly in floating rate instruments
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
10

11. IDFC Low Duration Fund IDFC Corporate Bond Fund
IDFC Money Manager Fund
An open ended low duration debt scheme investing in
instruments such that the Macaulay duration of the portfolio
is between 6 months and 12 months
An open ended debt scheme investing in money
market instruments
An open ended debt scheme predominantly
investing in AA+ and above rated corporate bonds.
Product Label

12. An open ended medium term debt scheme investing in instruments such
that the Macaulay duration of the portfolio is between 3 years and 4 years
IDFC Bond Fund – Medium Term IDFC Bond Fund – Short Term
An open ended short term debt scheme investing in instruments such
that the Macaulay duration of the portfolio is between 1 year and 3 years
IDFC Credit Risk Fund
An open ended debt scheme predominantly investing in AA
and below rated corporate bonds
Product Label

13. IDFC Banking PSU Debt Fund
IDFC Ultra Short Term Plan
An open-ended ultra-short term debt scheme
investing in instruments such that the Macaulay
duration of the portfolio is between 3 to 6 months
An open ended debt scheme predominantly investing in
debt instruments of banks, Public Sector Undertakings,
Public Financial Institutions and Municipal Bonds
IDFC Bond Fund – Income Plan
An open ended medium term debt scheme investing in
instruments such that the Macaulay duration of the
portfolio is between 4 years and 7 years
Product Label

14. An open ended dynamic debt scheme investing
across duration
IDFC Government Securities Fund -
Constant Maturity Plan
An open ended debt scheme investing in government securities
having a constant maturity of 10 years
IDFC Government Securities Fund –
Investment Plan
An open ended debt scheme investing in
government securities across maturities
IDFC Dynamic Bond Fund
Product Label

15. IDFC Cash Fund
An Open Ended Liquid Fund
IDFC Overnight Fund
An open-ended Debt Scheme investing in overnight securities
IDFC All Seasons Bond Fund
An open ended fund of fund scheme investing in debt oriented
mutual fund schemes (including liquid and money market
schemes) of IDFC Mutual Fund
Product Label

16. THANK YOU