The Scheme will retain the flexibility to invest in the entire range of money market and debt instruments. These instruments are more specifically highlighted below :
Debt securities (in the form of non-convertible debentures, bonds, secured premium notes, zero interest bonds, deep discount bonds, floating rate bond / notes, securitised debt, pass through certificates, asset backed securities, mortgage backed securities and any other domestic fixed income securities including structured obligations etc.) include, but are not limited to :
1. Debt obligations of the Government of India, State and local Governments, Government Agencies and statutory bodies (which may or may not carry a state / central
2. Securities that have been guaranteed by Government of India and State Governments,
3. Securities issued by Corporate Entities (Public / Private sector undertakings),
4. Securities issued by Public / Private sector banks and development financial institutions.
Money Market Instruments include
1. Commercial papers
2. Commercial bills
3. Treasury bills
4. Government securities having an unexpired maturity upto one year
5. Collateralised Borrowing & Lending Obligations (CBLO)
6. Certificate of deposit
7. Usance bills
8. Permitted securities under a repo / reverse repo agreement
9. Any other like instruments as may be permitted by RBI / SEBI from time to time
Investments will be made through secondary market purchases, initial public offers, other public offers, placements and right offers (including renunciation). The securities could be listed, unlisted, privately placed, secured / unsecured, rated / unrated of any maturity.
With respect to counterparty risk exposure arising out of OTC derivative and repo transactions, HDFC AMC does an ongoing credit assessment for setting appropriate counterparty limit and type of exposure the scheme can assume on all counterparties of the scheme. Internal control mechanisms ensure adherence to these limits and type of exposures.