DSP Merill Lynch Liquidity Fund Rides Money Mart

Mumbai, January 23: | Updated: Jan 24 2003, 05:30am hrs
DSP Merill Lynch Liqu-idity Fund has posted above average returns in the month of December on the back of having increased its holding in money market instruments.

Exposure to the Industrial Development Bank of India (IDBI) is up to 3.77 per cent in December 2002 from 2.87 per cent. The fund has exited from Indian Oil Corporation and Industrial Development and Finance Corporation. It has also exited from reverse repos instruments. As a result, cash and call have increased from 1.67 per cent to 36.33 per cent in the month of December. Exposure to bonds has been increased to 51.84 per cent in the portfolio, up from 47.14 per cent in November 2002.

The fund has invested only in high quality paper. The maturity of the portfolio is slightly up from 87 days to 91 days. Exposure to Panatone Finvest is enhanced from 7.20 per cent to 9.45 per cent. Exposure to the triple-A rated Reliance Industries is also up to 9.99 per cent from 7.67 per cent.

In the privately placed and unlisted instruments, the fund has exited from Rabo India Finance and has added GE Capital Services to the portfolio.

Analysts said that the scheme has posted positive returns over all time periods. It has overtaken the category averages across all periods and its annualised returns have also outperformed the benchmark SBI deposit rate over periods within one year.

For instance, over the one-year ended December 2002, the scheme posted 7.16 per cent in returns, while the category average was 6.83 per cent.