According to reports from Mint, ICICI Prudential Income Plus Arbitrage Omni FoF topped the 1-year return chart at 6.38%, followed by Franklin India Income Plus Arbitrage Active FoF at 6.28%. The category also includes Baroda BNP Paribas Income Plus Arbitrage Active FoF at 6.18%, Bandhan Income Plus Arbitrage Active FoF at 6.12%, and Axis Income Plus Arbitrage Omni FoF at 6.07%. These hybrid fund-of-funds combine debt and arbitrage exposure through underlying mutual fund schemes, with SEBI allowing up to 65% investment in debt-oriented schemes and the balance in arbitrage schemes.
As reported by Mint, the ICICI Prudential scheme's largest underlying exposure is to the ICICI Prudential Arbitrage Fund at 36.88% of assets. On the debt side, it allocates 31.22% to ICICI Prudential Corporate Bond Fund, 12.20% to ICICI Prudential Floating Interest Rates Fund, 9.97% to ICICI Prudential Nifty PSU Bond Plus SDL Sep 2027 40:60 Index, and 6.87% to ICICI Prudential Gilt Fund. The fund's reported asset allocation shows 62.76% debt, 37.4% cash and cash equivalents, and -0.16% equity. The negative equity allocation reflects derivative positions rather than actual equity holdings.
Latest data from Univest shows the ICICI Prudential Income Plus Arbitrage Omni FoF(G)-Direct Plan currently trades at an NAV of ₹72.1397 with an AUM of ₹3,277 crore. The fund maintains a low expense ratio of 0.03%, making it cost-effective for investors. The fund's diversified portfolio structure provides exposure to both debt-oriented schemes and arbitrage schemes through underlying mutual fund schemes, offering investors a balanced approach to income generation and capital appreciation.
According to Mint reports, traditional arbitrage funds operate under different regulations, requiring at least 65% of total assets in equity and restricting debt exposure to government securities with maturity under one year. The Quant Arbitrage Fund, which had the highest 1-year return among traditional arbitrage funds, shows -0.3% equity, 18.26% debt, and 82.04% cash and cash equivalents. While traditional funds focus primarily on arbitrage transactions, Income Plus Arbitrage FoFs provide exposure to both debt-oriented schemes and arbitrage schemes through underlying mutual fund schemes.
