SBI Savings Funds Review

The SBI Savings fund is a very short-term debt fund plan of SBI Mutual Fund which can be redeemed instantly. Savings funds are investments plan for the category of investors looking for a stable level of income while preserving the value of invested money. They are generally low-risk money market plans which can be opted for a long, medium or short term. These types of ultra-short-term funds invest money for a very short span in fixed income securities like treasury bills, commercial papers etc.

BEST SCHEMES OF SBI MUTUAL FUND ARE: 

  1. SBI BLUECHIP FUND

  2. SBI CONTRA FUND

  3. SBI MAGNUM EQUITY

  4. SBI MANGUM MIDCAP FUND

  5. SBI SHORT TERM DEBT FUND

INVESTMENT OBJECTIVE &  STRATEGY

The main objective of this fund is to provide investors with an opportunity to make investments in money-market. The underlying strategy of SBI savings fund is the generation of capital by employing a diversified portfolio of money market instruments and envisioning returns from both credit and term spreads.

HOW CAN I INVEST IN SBI SAVINGS FUND?

The best and most convenient way of starting with investments is through internet banking. You can start with SBI Mutual Fund online Service and select your investment scheme.

PERFORMANCE

SBI Savings fund was launched in July 2004. It has been a consistent one given the past performance. It has been doing fair justice as far as benchmark like CCIL T Bill liquidity weight ratios are concerned. It bags a 2-star rating by Value Research and expense ratio of 0.91%. The total assets under this fund are 5,720 Cr. The performance is being mapped over a large cap of 5 years to get the most adequate results. Being an open-ended product, it has many variants giving investors plenty of options. It offers flexibility in issuing and redeeming funds anytime. The investor can buy directly from the fund itself rather or from a previous shareholder. This is basically a collective fund scheme.

The latest NAV of SBI savings fund is 28.43 which is a plus on the last record. 

PORTFOLIO

SBI Savings fund is a quite diversified open-ended fund with its spread over 31 different fund categories with a one year high of 60 ad low of 26.  The highest yield has been 8.07%. It is an open-ended debt fund with 94.69% allocation to debt and money market. The fund is a growth product enjoying a large market share. The portfolio apart from being diversified is embellished with stocks having A1+ rating which makes it a performer consistently. 

SBI Savings fund has holdings in various sectors like:

  1. Financial

  2. Energy

  3. Construction

  4. Metals

  5. Chemicals

  6. Consumer goods

  7. Cash and cash equivalents

  8. Others

With the financial sector having maximum share followed in serial order. 

The complete portfolio of SBI savings fund is:

SNO

STOCK NAME

TOTAL AUM (in %age)

ANDHRA BANK

7.68

AXIS BANK

7.65

CHOLAMANDALAM INVESTMENT NAD FINANCE COMPANY LTD

7.47

ORIENTAL BANK OF COMMERCE

7.22

POWER FINANCE CORPORATION LTD

9.69

HOUSING DEVELOPMENT FINANCE CORPORATION LTD

6.75

NATIONAL BANK FOR AGRI AND RURAL DEVELOPMENT

5.31

TATA POWER RENEWABLE ENERGY LTD

5.14

JSW STEEL LTD

4.80

IDFC FIRST BANK LTD

4.32

JM FINANCIAL ASSET RECONSTRUCTION COMPANY LTD

3.67

L & T FINANCE HOLDINGS LTD

3.48

LIC HOUSING FINANCE LTD

3.17

REC LIMITED

2.96

TATA CAPITAL FINANCIAL SERVICES LTD

2.83

KOTAK MAHINDRA BANK LTD

2.56

DALMIA CEMENT (BHARAT) LTD

2.21

PNB HOUSING FINANCE LTD

1.85

SUNDARAM BNP PARIBAS HOME FINANCE

1.73

TATA CAPITAL HOUSING FINANCE LTD

1.54

TOYOTA FINANCIAL SERVICES INDIA LTD

1.47

MUTHOOT FINANCE LTD

1.47

SIDBI LTD

1.42

AXIS BANK LTD

1.42

ICICI BANK LTD

1.14

HDB FINANCIAL SERVICES LTD

0.71

ISSUER

0.00

TOTAL

96.93

ASSET ALLOCATION

SBI savings fund is an open-ended debt fund has its maximum share invested in debt and money market, some minimal share in cash/call and no holdings in equity.

The allocation goes as:

  • Money market- 90.44%

  • Debt- 6.89%

  • Cash/call-2.69%

  • Equity-0.00%

Top 10 holdings of SBI Savings fund are:

  1. Indian Oil Corp

  2. RMZ Infotech

  3. JSW Steel

  4. Indiabulls Commercial Credit

  5. IDFC First Bank

  6. Indiabulls Housing Finance

  7. L&T Finance Holdings

  8. Renew Power

  9. Cholamandalam Invest and Finance

  10. HDFC

RISK PROFILE

Debt Risk

SBI Savings fund is an open-ended debt fund comes with the certain debt instrument risk which is the interest rate risk. Since being short term assets, the rate of interest may vary as per the market affecting the returns directly. 

Mitigating the risk

Diversification of the portfolio is the biggest game changer in dealing with associated risks. Other factors influencing risks are unstable management, inconsistent sales and returns etc. Sieving out funds showing these characteristics would help in reducing the risk to a great extent. 

FUND MANAGER

SBI Savings fund is managed by Mr. R. Arun.  He has an experience of over 10 years in the industry with roles ranging from credit analyst to fund manager. Prior to SBI, he has worked with organisations like ING investment, Deutsch Bank and CRISIL which add to his credibility. He is a finance graduate from the University of Mumbai. 

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