ICICI Prudential BSE Liquid Rate ETF Gets a New Name

ICICI Prudential Mutual Fund has announced a name change for its “ICICI Prudential BSE Liquid Rate ETF.” Effective January 27, 2025, the fund will be renamed ICICI Prudential BSE Liquid Rate ETF – IDCW (Income Distribution cum Capital Withdrawal). The change shows the fund’s income distribution option, aligning it with regulatory naming conventions.

Fund Details and Strategy

The fund primarily invests in CBLOs (Collateralized Borrowing and Lending Obligations) and aims to deliver returns closely tracking the S&P BSE Liquid Rate Index, subject to tracking errors. 

As a liquid fund, it holds 100% cash and cash equivalents, making it a low-risk option for short-term parking of funds.

Taxation on Gains and Dividends

Investments made on or after April 1, 2023, are subject to slab-rate taxation. Gains made within a year are added to the investor’s income and taxed accordingly. Gains from investments before this date are taxed at 12.5% if sold after one year.

For dividends, the amount is added to the investor’s taxable income and taxed based on the applicable slab rate. Additionally, if dividend income exceeds ₹5,000 in a financial year, the fund house deducts a 10% TDS before distribution.

As of January 23, 2025, the fund’s NAV-IDCW Daily stood at ₹1,000.0000, showcasing a 0.02% gain, and its one-year return was 6.45%.

Risks and Considerations

While liquid funds generally involve minimal risk, they do not guarantee returns or capital safety. Although rare, instances of losses in liquid funds have occurred.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.