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Best 10-Year GILT Mutual Funds 2019 | Government Bond Funds

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Best 10-Year Gilt Funds 2019

Updated on November 13, 2019 , 1571 views

Gilt Funds are a type of debt Mutual Funds that predominately invest in Government Securities (G-Secs) issued by the RBI (Reserve Bank of India) on behalf of the government.

Ideally, there are two kinds of gilt funds offered to the investors, one is gilt funds that invest in government securities across maturity. And the other is 10-year gilt funds that will invest in government securities with a maturity of 10 years.

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Gilt Funds with 10-Year Constant Maturity

A gilt fund with 10-year constant maturity will invest 80 percent of its total assets in government securities. Gilt funds having an average maturity of 10 years are usually quite sensitive to interest rate changes. If suppose, you are holding these funds, and interest rates begin to rise, then there are extreme chances that these funds can give you negative returns.

10-year-gilt-funds

In contrast, the times where interest rates are expected to come down, gilt funds with higher maturity has the capability to deliver good returns. But, unlike other Debt fund, these funds are not exposed to credit risk unless the government goes bankrupt.

Investors who are planning to invest in such high maturity gilt funds, it is advisable to invest when interest rates are expected to ease down because a decrease in interest rates causes a rise in the prices of long-term gilt securities. Also, it would be convenient for an investor to shift their investment from short-term gilt securities to higher maturity when the interest rates are expected to fall.

Why Should One Invest in Gilt Mutual Funds?

Gilt debt funds tend to offer the dual benefit of security and returns. Your investments are in government Bonds and hence, there is a very little risk to the invested amount. Moreover, it also gives better returns when compared to the savings bank account.

Though gilt funds with higher maturity can be risky at times, as they are more prone to interest rate risk, but they are not affected by the credit risk. So, investors who can tolerate little risk in investment can plan to invest in gilt funds with a 10-year constant maturity.

Best Performing 10 Year Gilt Funds to Invest in 2019

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2018 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
SBI Magnum Constant Maturity Fund Growth ₹44.3679
↑ 0.03
₹4511.68.714.89.69.96.83%6Y 4M 10D9Y 6M 29D
IDFC Government Securities Fund - Constant Maturity Plan Growth ₹31.4128
↑ 0.02
₹1241.89.217.610.511.87.05%7Y 1M 10D10Y 6M 18D
ICICI Prudential Constant Maturity Gilt Fund Growth ₹16.7185
↑ 0.01
₹822.19.115.989.76.99%6Y 10M 28D10Y 18D
DSP BlackRock 10Y G-Sec Fund Growth ₹15.62
↑ 0.00
₹421.28.413.76.45.96.65%6Y 4M 24D8Y 11M 16D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 15 Nov 19

1. SBI Magnum Constant Maturity Fund

(Erstwhile SBI Magnum Gilt Fund Short Term)

To provide the investors with the returns generated through investments in government securities issued by the Central Govt. and State Govt.

SBI Magnum Constant Maturity Fund is a Debt - 10 Yr Govt Bond fund was launched on 30 Dec 00. It is a fund with Moderately Low risk and has given a CAGR/Annualized return of 8.2% since its launch.  Ranked 1 in 10 Yr Govt Bond category.  Return for 2018 was 9.9% , 2017 was 6.2% and 2016 was 12.8% .

Below is the key information for SBI Magnum Constant Maturity Fund

SBI Magnum Constant Maturity Fund
Growth
Launch Date 30 Dec 00
NAV (15 Nov 19) ₹44.3679 ↑ 0.03   (0.08 %)
Net Assets (Cr) ₹451 on 30 Sep 19
Category Debt - 10 Yr Govt Bond
AMC SBI Funds Management Private Limited
Rating
Risk Moderately Low
Expense Ratio 0.74
Sharpe Ratio 2.83
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 6.83%
Effective Maturity 9 Years 6 Months 29 Days
Modified Duration 6 Years 4 Months 10 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 14₹10,000
31 Oct 15₹11,143
31 Oct 16₹12,380
31 Oct 17₹13,473
31 Oct 18₹14,241
31 Oct 19₹16,506

SBI Magnum Constant Maturity Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹212,284.
Net Profit of ₹32,284
Invest Now

Returns for SBI Magnum Constant Maturity Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 15 Nov 19

DurationReturns
1 Month 0.4%
3 Month 1.6%
6 Month 8.7%
1 Year 14.8%
3 Year 9.6%
5 Year 10.4%
10 Year
15 Year
Since launch 8.2%
Historical performance (Yearly) on absolute basis
YearReturns
2018 9.9%
2017 6.2%
2016 12.8%
2015 9.1%
2014 12.6%
2013 8.7%
2012 9.2%
2011 8.4%
2010 5.2%
2009 -3.2%
Fund Manager information for SBI Magnum Constant Maturity Fund
NameSinceTenure
Mahak Khabhia7 May 181.49 Yr.

Data below for SBI Magnum Constant Maturity Fund as on 30 Sep 19

Asset Allocation
Asset ClassValue
Cash12.84%
Debt87.16%
Debt Sector Allocation
SectorValue
Government87.16%
Cash Equivalent12.84%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.26% Govt Stock 2029
Sovereign Bonds | -
37%₹166 Cr16,000,000
↑ 6,000,000
6.68% Govt Stock 2031
Sovereign Bonds | -
27%₹122 Cr12,500,000
↓ -4,000,000
7.95% Govt Stock 2032
Sovereign Bonds | -
23%₹102 Cr9,500,000
↑ 9,500,000
Treps
CBLO/Reverse Repo | -
13%₹58 Cr
Net Receivable / Payable
- | -
1%₹3 Cr

2. IDFC Government Securities Fund - Constant Maturity Plan

(Erstwhile IDFC Government Securities Fund - Short Term Plan)

IDFC – GSF -ST is an open ended dedicated gilt scheme with an objective to generate optimal returns with high liquidity by investing Government Securities. However there is no assurance that the investment objective of the scheme will be realized.

IDFC Government Securities Fund - Constant Maturity Plan is a Debt - 10 Yr Govt Bond fund was launched on 9 Mar 02. It is a fund with Moderate risk and has given a CAGR/Annualized return of 6.7% since its launch.  Ranked 2 in 10 Yr Govt Bond category.  Return for 2018 was 11.8% , 2017 was 6.2% and 2016 was 10.1% .

Below is the key information for IDFC Government Securities Fund - Constant Maturity Plan

IDFC Government Securities Fund - Constant Maturity Plan
Growth
Launch Date 9 Mar 02
NAV (15 Nov 19) ₹31.4128 ↑ 0.02   (0.06 %)
Net Assets (Cr) ₹124 on 30 Sep 19
Category Debt - 10 Yr Govt Bond
AMC IDFC Asset Management Company Limited
Rating
Risk Moderate
Expense Ratio 0.47
Sharpe Ratio 3.1
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load NIL
Yield to Maturity 7.05%
Effective Maturity 10 Years 6 Months 18 Days
Modified Duration 7 Years 1 Month 10 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 14₹10,000
31 Oct 15₹11,038
31 Oct 16₹12,095
31 Oct 17₹13,085
31 Oct 18₹13,861
31 Oct 19₹16,487

IDFC Government Securities Fund - Constant Maturity Plan SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹212,284.
Net Profit of ₹32,284
Invest Now

Returns for IDFC Government Securities Fund - Constant Maturity Plan

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 15 Nov 19

DurationReturns
1 Month 0.4%
3 Month 1.8%
6 Month 9.2%
1 Year 17.6%
3 Year 10.5%
5 Year 10.4%
10 Year
15 Year
Since launch 6.7%
Historical performance (Yearly) on absolute basis
YearReturns
2018 11.8%
2017 6.2%
2016 10.1%
2015 9%
2014 12.6%
2013 10.6%
2012 8.6%
2011 1.9%
2010 3.5%
2009 2.3%
Fund Manager information for IDFC Government Securities Fund - Constant Maturity Plan
NameSinceTenure
Harshal Joshi15 May 172.46 Yr.

Data below for IDFC Government Securities Fund - Constant Maturity Plan as on 30 Sep 19

Asset Allocation
Asset ClassValue
Cash4.38%
Debt95.62%
Debt Sector Allocation
SectorValue
Government98.09%
Cash Equivalent1.91%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.88% GS 2030
Sovereign Bonds | -
60%₹75 Cr7,000,000
↑ 4,000,000
GOVT STOCK
Sovereign Bonds | -
17%₹21 Cr2,000,000
↑ 2,000,000
8.24% Govt Stock 2027
Sovereign Bonds | -
12%₹15 Cr1,400,000
↑ 1,400,000
7.61% Govt Stock 2030
Sovereign Bonds | -
4%₹5 Cr500,000
↑ 500,000
6.68% Govt Stock 2031
Sovereign Bonds | -
4%₹5 Cr500,000
↓ -4,000,000
Triparty Repo
CBLO/Reverse Repo | -
1%₹1 Cr
Net Current Assets
Net Current Assets | -
0%₹0 Cr
Cash Margin - Ccil
CBLO/Reverse Repo | -
0%₹0 Cr
7.26% Govt Stock 2029
Sovereign Bonds | -
0%₹0 Cr30,000
↓ -2,970,000

3. ICICI Prudential Constant Maturity Gilt Fund

The Scheme aims to provide reasonable returns by investing in portfolio of Government Securities with average maturity of around 10 years. However, there can be no assurance that the investment objective of the Scheme will be realized.

ICICI Prudential Constant Maturity Gilt Fund is a Debt - 10 Yr Govt Bond fund was launched on 12 Sep 14. It is a fund with Moderate risk and has given a CAGR/Annualized return of 10.4% since its launch.  Ranked 6 in 10 Yr Govt Bond category.  Return for 2018 was 9.7% , 2017 was 2.4% and 2016 was 16.2% .

Below is the key information for ICICI Prudential Constant Maturity Gilt Fund

ICICI Prudential Constant Maturity Gilt Fund
Growth
Launch Date 12 Sep 14
NAV (15 Nov 19) ₹16.7185 ↑ 0.01   (0.07 %)
Net Assets (Cr) ₹82 on 30 Sep 19
Category Debt - 10 Yr Govt Bond
AMC ICICI Prudential Asset Management Company Limited
Rating
Risk Moderate
Expense Ratio 0.33
Sharpe Ratio 2.76
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load 0-7 Days (0.25%),7 Days and above(NIL)
Yield to Maturity 6.99%
Effective Maturity 10 Years 18 Days
Modified Duration 6 Years 10 Months 28 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 14₹10,000
31 Oct 15₹11,117
31 Oct 16₹12,607
31 Oct 17₹13,390
31 Oct 18₹13,876
31 Oct 19₹16,219

ICICI Prudential Constant Maturity Gilt Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹212,284.
Net Profit of ₹32,284
Invest Now

Returns for ICICI Prudential Constant Maturity Gilt Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 15 Nov 19

DurationReturns
1 Month 0.4%
3 Month 2.1%
6 Month 9.1%
1 Year 15.9%
3 Year 8%
5 Year 10%
10 Year
15 Year
Since launch 10.4%
Historical performance (Yearly) on absolute basis
YearReturns
2018 9.7%
2017 2.4%
2016 16.2%
2015 6.9%
2014
2013
2012
2011
2010
2009
Fund Manager information for ICICI Prudential Constant Maturity Gilt Fund
NameSinceTenure
Rahul Goswami12 Sep 145.05 Yr.

Data below for ICICI Prudential Constant Maturity Gilt Fund as on 30 Sep 19

Asset Allocation
Asset ClassValue
Cash2.14%
Debt97.86%
Debt Sector Allocation
SectorValue
Government97.86%
Cash Equivalent2.14%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.79% Govt Stock 2029
Sovereign Bonds | -
49%₹42 Cr4,250,000
↑ 400,000
7.59% Govt Stock 2029
Sovereign Bonds | -
30%₹26 Cr2,500,000
GOVT STOCK
Sovereign Bonds | -
15%₹13 Cr1,200,000
↑ 200,000
7.26% Govt Stock 2029
Sovereign Bonds | -
4%₹3 Cr300,000
Net Current Assets
Net Current Assets | -
2%₹2 Cr
Treps
CBLO/Reverse Repo | -
0%₹0 Cr

4. DSP BlackRock 10Y G-Sec Fund

(Erstwhile DSP BlackRock Constant Maturity 10Y G-Sec Fund)

The investment objective of the Scheme is to seek to generate returns commensurate with risk from a portfolio of Government Securities with weighted average maturity of around 10 years. There is no assurance that the investment objective of the Scheme will be realized.

DSP BlackRock 10Y G-Sec Fund is a Debt - 10 Yr Govt Bond fund was launched on 26 Sep 14. It is a fund with Moderate risk and has given a CAGR/Annualized return of 9.1% since its launch.  Ranked 8 in 10 Yr Govt Bond category.  Return for 2018 was 5.9% , 2017 was 2.3% and 2016 was 15.5% .

Below is the key information for DSP BlackRock 10Y G-Sec Fund

DSP BlackRock 10Y G-Sec Fund
Growth
Launch Date 26 Sep 14
NAV (15 Nov 19) ₹15.62 ↑ 0.00   (0.02 %)
Net Assets (Cr) ₹42 on 30 Sep 19
Category Debt - 10 Yr Govt Bond
AMC DSP BlackRock Invmt Managers Pvt. Ltd.
Rating
Risk Moderate
Expense Ratio 0.47
Sharpe Ratio 2.1
Information Ratio 0
Alpha Ratio 0
Min Investment 1,000
Min SIP Investment 500
Exit Load 0-7 Days (0.1%),7 Days and above(NIL)
Yield to Maturity 6.65%
Effective Maturity 8 Years 11 Months 16 Days
Modified Duration 6 Years 4 Months 24 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 14₹10,000
31 Oct 15₹11,047
31 Oct 16₹12,418
31 Oct 17₹13,310
31 Oct 18₹13,318
31 Oct 19₹15,251

DSP BlackRock 10Y G-Sec Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹206,148.
Net Profit of ₹26,148
Invest Now

Returns for DSP BlackRock 10Y G-Sec Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 15 Nov 19

DurationReturns
1 Month 0.4%
3 Month 1.2%
6 Month 8.4%
1 Year 13.7%
3 Year 6.4%
5 Year 8.7%
10 Year
15 Year
Since launch 9.1%
Historical performance (Yearly) on absolute basis
YearReturns
2018 5.9%
2017 2.3%
2016 15.5%
2015 6.6%
2014
2013
2012
2011
2010
2009
Fund Manager information for DSP BlackRock 10Y G-Sec Fund
NameSinceTenure
Vikram Chopra17 Jul 162.87 Yr.
Vivek Ved17 Jul 162.87 Yr.

Data below for DSP BlackRock 10Y G-Sec Fund as on 30 Sep 19

Asset Allocation
Asset ClassValue
Cash3.66%
Debt96.34%
Debt Sector Allocation
SectorValue
Government93.31%
Cash Equivalent6.69%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.26% Govt Stock 2029
Sovereign Bonds | -
96%₹41 Cr3,844,500
↓ -416,300
Treps / Reverse Repo Investments / Corporate Debt Repo
CBLO/Reverse Repo | -
4%₹2 Cr
Net Receivables/Payables
Net Current Assets | -
1%₹0 Cr

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How do 10-Year Gilt Funds Generate Returns?

Gilt funds predominately generate returns by trading the underlying instruments. Depending on the interest rate outlook, a fund manager will tend to trade in and out of gilts with varying maturities. By these means, trading returns will be generated by the fund, apart from the returns generated on the coupon (the yield).

In this manner, the fund manager takes a view on the future movement of the interest rates in the market and invests either in short-term gilt funds or gilt funds with higher maturity. When a fund manager presumes interest rates are going to fall, a major part of the portfolio will be shifted to longer-maturity securities. Also, in such market scenario, the price of the existing long-term bonds tends to rise more than those of shorter maturity gilts.

Since gilts are linked to the market on a day-to-day basis, the price movement is reflected in the Net Asset Value (NAV) of the fund. An understanding of interest rate movements and their impact on the returns (as per its duration) is essential in order to understand the potential returns that can be generated by Investing in gilt funds.

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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