ICICI Prudential Equity & Debt Fund: See how much this fund gave in 25 years? Should you invest?

During periods of market volatility, investors often seek to diversify their mutual fund holdings. One option that has gained popularity is aggressive hybrid funds, which typically allocate 65-80% of their assets to equities and 20-35% to debt instruments. This strategy aims to provide growth potential through equity exposure while also offering some stability through fixed-income investments.

One example of an aggressive hybrid fund is the ICICI Prudential Equity & Debt Fund, which recently celebrated its 25th anniversary on November 3. Over the past 20 years, the fund has delivered a impressive compound annual growth rate (CAGR) of 16.54%. 

Since its inception in 1999, the fund has achieved a CAGR of 15.52%, with a 15.57% CAGR over the last decade. This fund primarily focuses on equity and equity-related instruments to drive returns for investors. ICICI Prudential Equity & Debt Fund offered 28.07% return in the last nine months period.

ICICI Prudential Equity & Debt Fund Direct-Growth is an Aggressive Hybrid mutual fund scheme provided by ICICI Prudential Mutual Fund. The objective of the scheme is to achieve long-term capital appreciation and current income through a diversified portfolio consisting of equities, related securities, fixed income, and money market securities. The allocation to equities will range from 60-80%, with a minimum of 51%, while the allocation to debt will range from 40-49%, with a minimum of 20%.

This scheme has an expense ratio of approximately 0.98%, which is on the higher end compared to similar Aggressive Hybrid funds. As of now, the fund has invested 66.21% in equity and 21.25% in Debt. An interesting fact about this fund is its consistent performance in doubling the invested capital every 4 years.

Furthermore, the capacity of ICICI Prudential Equity & Debt Fund Direct-Growth to generate returns consistently exceeds that of most funds in its category. It also demonstrates a commendable ability to mitigate losses during market downturns.

The equity portion of the fund is primarily focused on sectors such as Financial, Energy, Automobile, Healthcare, and Communication. Notably, it has a comparatively lower exposure in Financial and Energy sectors in comparison to its peers in the same category.

The credit quality of the debt portion in the fund is low, implying that the borrowers to whom it has lent may not have strong credit ratings. The top five holdings in the fund include NTPC Ltd., ICICI Bank Ltd., Maruti Suzuki India Ltd., Government of India, and Bharti Airtel Ltd.