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Best Debt Mutual Funds 2022

Updated on May 18, 2022 , 57744 views

Best debt funds vary according to the tenor of investment of the investor. Investors need to be clear on their time horizon of investment when selecting the best Debt fund for their investment and also factor in the interest rate scenario.

For investors with a very short holding period, say for a couple of days to a month, Liquid Funds and ultra-short term funds may be relevant. When the time horizon is one to two years then short-term funds may be the desired vehicle. For longer tenors, for more than 3 years, long-term debt funds are the most preferred instruments by investors, especially during falling interest rates. Above all, debt funds have proved to be less risky than equities when looking for short-term investments, however, the volatility of long-term income funds may match that of equities.

Best Debt Funds

As debt funds invest in fixed income instruments like government securities, treasury bills, corporate Bonds, etc., they have the capacity of generating consistent and regular returns over time. However, there are many qualitative and quantitative factors that one needs understand before selecting the best debt funds to invest, viz - AUM, Average Maturity, Taxation, the credit quality of the portfolio, etc. Below we have listed the top 5 best debt funds to invest across the various categories of debt funds - Best Liquid Funds, best ultra short-term funds, best short-term funds, best long-term funds and best Gilt Funds to invest in 2022 - 2023.

Why To Invest in Debt Mutual Funds?

a. Debt funds are considered to be an ideal investment for generating regular income. For example, choosing dividend payout can be an option for regular income.

b. In debt funds, investors can withdraw required money from the investment at any point in time and can let the remaining money stay invested.

c. Since debt funds largely invest in government securities, corporate debt and other securities like treasury bills, etc., they are not affected by equity market volatility.

d. If an investor is planning to achieve short-term Financial goals or invest for short periods then debt funds can be a good option. Liquid funds, ultra short-term funds, and short-term income funds may be the desired options.

e. In debt funds, investors can generate fixed income every month by starting a Systematic Withdrawal Plan (SWP is a reverse of SIP / STP) to withdraw a fixed amount on a monthly basis. Also, you can change the amount of the SWP when required.

Risks In Debt Mutual Funds

While Investing in debt funds, investors should be cautious about two major risks associated with them- credit risk and interest risk.

a. Credit Risk

A credit risk arises when a company that has issued the debt instruments does not make regular payments. In such cases, it has a major impact on the fund, depending on how much portion the fund has in the portfolio. Hence, it is suggested to be in debt instruments with a rating higher credit rating. An AAA rating is considered to be the highest quality with little or negligible payment Default Risk.

b. Interest Risks

The interest rate risk refers to a change in the bond price due to the change in the prevailing interest rate. When the interest rate rise in the economy the bond prices fall down and vice versa. The higher the maturity of the funds’ portfolio, the more prone it is to the interest rate risk. So in a rising interest rate scenario, it is advisable to go for lower maturity debt funds. And the reverse in a falling interest rate scenario.

Debt Mutual Fund Taxation

Tax implication on debt funds is computed in the following manner-

a. Short Term Capital Gains

If the holding period of a debt investment is less than 36 months, then it is classified as a short-term investment and these are taxed as per individual's tax slab.

b. Long Term Capital Gains

If the holding period of debt investment is more than 36 months, then it is classified as a long-term investment and is taxed at 20% with an indexation benefit.

Capital Gains Investment Holding Gains Taxation
Short Term Capital Gains Less than 36 months As per individual's tax slab
Long Term Capital Gains More than 36 months 20% with indexation benefits

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Best Debt Mutual Funds in India for Investments FY 22 - 23

Top 5 Liquid Mutual Funds

Top Liquid funds with AUM/Net Assets > 10,000 Crore.

FundNAVNet Assets (Cr)Min Investment1 MO (%)3 MO (%)6 MO (%)1 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Axis Liquid Fund Growth ₹2,361.02
↑ 0.32
₹28,934 500 0.30.91.83.43.33.88%1M 12D1M 13D
Aditya Birla Sun Life Liquid Fund Growth ₹341.951
↑ 0.04
₹32,899 5,000 0.20.81.73.43.34.15%1M 13D1M 13D
Tata Liquid Fund Growth ₹3,347.91
↑ 0.41
₹13,843 5,000 0.20.81.73.43.24.09%1M 15D1M 16D
ICICI Prudential Liquid Fund Growth ₹314.54
↑ 0.04
₹39,902 500 0.20.81.73.43.23.91%1M 22D1M 25D
Nippon India Liquid Fund  Growth ₹5,186.81
↑ 0.64
₹25,763 100 0.20.81.73.43.24.07%1M 15D1M 17D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Ultra Short Term Bond Mutual Funds

Top Ultra Short Bond funds with AUM/Net Assets > 1,000 Crore.

FundNAVNet Assets (Cr)Min Investment3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Aditya Birla Sun Life Savings Fund Growth ₹441.001
↑ 0.06
₹16,109 1,000 0.61.73.75.73.95.04%5M 26D6M
UTI Ultra Short Term Fund Growth ₹3,464.8
↑ 0.16
₹2,506 5,000 0.51.45.84.36.14.65%4M 15D4M 20D
ICICI Prudential Ultra Short Term Fund Growth ₹22.4725
↑ 0.00
₹13,266 5,000 0.71.63.65.644.61%3M 4D3M 25D
SBI Magnum Ultra Short Duration Fund Growth ₹4,848.9
↑ 0.33
₹14,029 5,000 0.51.53.253.44.54%5M 5D5M 16D
Kotak Savings Fund Growth ₹34.9552
↑ 0.00
₹12,596 5,000 0.61.53.24.93.24.66%4M 17D5M 16D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top and Best Floating Rate Mutual Funds

FundNAVNet Assets (Cr)Min Investment3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Aditya Birla Sun Life Floating Rate Fund - Long Term Growth ₹277.943
↓ 0.00
₹15,937 1,000 0.71.53.56.23.65.24%7M 2D1Y 4M 28D
ICICI Prudential Floating Interest Fund Growth ₹336.956
↓ -0.55
₹16,087 5,000 0.30.23.16.33.85.87%1Y 4M 2D7Y 8M 16D
Nippon India Floating Rate Fund Growth ₹36.0644
↓ 0.00
₹14,223 5,000 -0.10.82.96.93.75.39%1Y 1M 10D1Y 6M 25D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Best Money Market Mutual Funds

FundNAVNet Assets (Cr)Min Investment3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Aditya Birla Sun Life Money Manager Fund Growth ₹296.668
↑ 0.02
₹15,495 1,000 0.61.63.55.53.84.75%5M 12D5M 12D
UTI Money Market Fund Growth ₹2,472.96
↑ 0.24
₹10,561 10,000 0.81.73.65.33.74.47%4M 6D4M 4D
Kotak Money Market Scheme Growth ₹3,609.56
↑ 0.34
₹15,402 5,000 0.81.73.65.13.74.58%4M 13D4M 13D
ICICI Prudential Money Market Fund Growth ₹304.713
↑ 0.03
₹13,002 500 0.71.63.45.23.74.6%6M 18D6M 28D
L&T Money Market Fund Growth ₹21.4288
↑ 0.00
₹1,053 10,000 0.51.32.84.92.94.55%5M 16D5M 19D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Short Term Bond Mutual Funds

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
PGIM India Short Maturity Fund Growth ₹36.4867
↓ 0.00
₹29-0.30.423.134.89%1Y 18D1Y 2M 26D
UTI Short Term Income Fund Growth ₹25.487
↑ 0.00
₹2,51000.77.64.28.45.62%1Y 3M 18D2Y 2M 26D
Aditya Birla Sun Life Short Term Opportunities Fund Growth ₹38.1091
↓ 0.00
₹8,4840.10.93.173.85.94%1Y 4M 28D2Y 1M 6D
ICICI Prudential Short Term Fund Growth ₹47.6618
↓ -0.03
₹16,6230.10.52.873.95.74%1Y 5M 23D4Y 4D
Nippon India Short Term Fund Growth ₹42.3539
₹8,160-0.70.32.66.64.45.8%1Y 7M 28D1Y 11M 19D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Medium to Long Term Bond Mutual Funds

Top Medium to Long Term Bond funds with AUM/Net Assets > 500 Crore.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
SBI Magnum Income Fund Growth ₹56.1214
↓ -0.05
₹1,632-1.4-1.11.47.53.66.68%3Y 9M 25D6Y 4M 17D
Aditya Birla Sun Life Income Fund Growth ₹100.576
↓ -0.04
₹1,566-1.9-1.21.57.246.4%2Y 8M 23D3Y 1M 24D
ICICI Prudential Bond Fund Growth ₹31.4555
↓ -0.02
₹2,707-1.4-1.40.66.72.95.71%2Y 9M 22D5Y 3M 11D
Kotak Bond Fund Growth ₹61.6608
↓ -0.08
₹1,653-1.9-1.71.26.42.46.07%2Y 10M 6D7Y 1M 28D
HDFC Income Fund Growth ₹46.7036
↓ -0.04
₹537-2.1-2.3-0.64.92.16.51%3Y 11M 5D6Y 7M 12D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Banking and PSU Debt Mutual Funds

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
UTI Banking & PSU Debt Fund Growth ₹17.6067
↑ 0.01
₹2935.76.68.37.72.85.19%1Y 4M 10D1Y 7M 20D
HDFC Banking and PSU Debt Fund Growth ₹18.5067
↓ 0.00
₹6,564-0.30.32.66.93.75.62%1Y 11M 3D3Y 4M 15D
ICICI Prudential Banking and PSU Debt Fund Growth ₹26.0954
↓ -0.02
₹10,5100.30.53.36.94.25.77%2Y 2M 12D5Y 10M 2D
Kotak Banking and PSU Debt fund Growth ₹52.3515
↓ -0.03
₹7,845-0.50.22.97.13.95.8%2Y 2M 26D4Y 11M 1D
Aditya Birla Sun Life Banking & PSU Debt Fund Growth ₹294.697
↓ -0.05
₹12,063-0.20.62.87.13.65.51%1Y 8M 12D2Y 6M
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Credit Risk Mutual Funds

Top Credit Risk funds with AUM/Net Assets > 500 Crore.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Axis Credit Risk Fund Growth ₹17.0823
↓ 0.00
₹719-0.30.83.65.366.55%1Y 5M 1D1Y 9M 14D
SBI Credit Risk Fund Growth ₹36.0028
↑ 0.00
₹3,093013.96.656.45%1Y 6M 29D2Y 5M 16D
HDFC Credit Risk Debt Fund Growth ₹19.2416
↑ 0.01
₹8,925-0.70.43.87.877.2%2Y 2M 25D2Y 11M 1D
Kotak Credit Risk Fund Growth ₹23.9532
↓ -0.01
₹1,690-2.6-1.61.35.35.36.44%1Y 7M 10D2Y 5M 16D
UTI Credit Risk Fund Growth ₹13.8065
↑ 0.02
₹5190120.2-6.221.56.55%1Y 8M 8D2Y 4M 6D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Dynamic Bond Mutual Funds

Top Dynamic Bond funds with AUM/Net Assets > 500 Crore.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
ICICI Prudential Long Term Plan Growth ₹28.9251
↓ -0.03
₹5,993-0.7-0.42.17.54.36.39%2Y 3M 14D5Y 10M 17D
SBI Dynamic Bond Fund Growth ₹28.2272
↓ 0.00
₹2,316-0.301.56.925.27%1Y 4M 2D1Y 4M 13D
HDFC Dynamic Debt Fund Growth ₹72.2026
↓ -0.12
₹517-1.2-1.65.76.77.45.71%2Y 1M 3D5Y 8M 28D
Aditya Birla Sun Life Dynamic Bond Fund Growth ₹35.7582
↑ 0.00
₹1,420-0.8-0.22.544.96.38%1Y 8M 1D2Y 2M 12D
Axis Dynamic Bond Fund Growth ₹23.391
↑ 0.01
₹2,521-2.4-1.90.37.13.96.86%5Y 9M 7D7Y 11M 16D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Corporate Bond Mutual Funds

Top Corporate Bond funds with AUM/Net Assets > 500 Crore.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Aditya Birla Sun Life Corporate Bond Fund Growth ₹89.3471
↓ -0.02
₹17,156-0.30.52.87.346.21%1Y 8M 23D2Y 7M 6D
HDFC Corporate Bond Fund Growth ₹25.793
↓ -0.02
₹22,737-0.9-0.22.27.13.96.07%2Y 6M 27D4Y 8M 1D
Nippon India Prime Debt Fund Growth ₹47.4258
↑ 0.00
₹2,885-0.30.83.46.34.75.91%1Y 6M 25D1Y 11M 16D
ICICI Prudential Corporate Bond Fund Growth ₹23.6091
↓ -0.01
₹17,7110.10.63.174.15.7%1Y 4M 17D4Y 5M 16D
Kotak Corporate Bond Fund Standard Growth ₹3,014.04
↓ -0.09
₹9,535-0.20.52.96.53.85.63%1Y 1M 28D2Y 8M 5D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

Top 5 Gilt Mutual Funds

Top GILT funds with AUM/Net Assets > 500 Crore.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2021 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
ICICI Prudential Gilt Fund Growth ₹80.2844
↓ -0.17
₹2,327-0.6-1.42.27.73.85.62%2Y 5M 5D9Y 2M 26D
SBI Magnum Gilt Fund Growth ₹51.8261
↓ 0.00
₹3,540-0.401.97.935.13%1Y 5M 23D1Y 7M 2D
UTI Gilt Fund Growth ₹50.1818
↓ -0.05
₹543-0.2-0.81.36.72.34.66%10M 20D3Y 3M
Aditya Birla Sun Life Government Securities Fund Growth ₹64.7339
↓ -0.04
₹1,170-2.3-1.61.27.23.66.62%3Y 1M 10D3Y 8M 12D
Nippon India Gilt Securities Fund Growth ₹30.4231
↓ -0.02
₹1,232-1.9-1.90.16.51.86.13%3Y 11M 26D5Y 4D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22

1. UTI Dynamic Bond Fund

The investment objective of the scheme is to generate optimal returns with adequate liquidity through active management of the portfolio, by investing in debt and money market instruments. However, there can be no assurance that the investment objective of the scheme will be realized.

UTI Dynamic Bond Fund is a Debt - Dynamic Bond fund was launched on 16 Jun 10. It is a fund with Moderate risk and has given a CAGR/Annualized return of 8% since its launch.  Ranked 3 in Dynamic Bond category.  Return for 2021 was 10.8% , 2020 was 5.9% and 2019 was -3.9% .

Below is the key information for UTI Dynamic Bond Fund

UTI Dynamic Bond Fund
Growth
Launch Date 16 Jun 10
NAV (20 May 22) ₹25.0534 ↓ -0.01   (-0.02 %)
Net Assets (Cr) ₹366 on 30 Apr 22
Category Debt - Dynamic Bond
AMC UTI Asset Management Company Ltd
Rating
Risk Moderate
Expense Ratio 0.18
Sharpe Ratio 0.77
Information Ratio 0
Alpha Ratio 0
Min Investment 10,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 4.26%
Effective Maturity 2 Years 3 Months 4 Days
Modified Duration 9 Months 25 Days

Growth of 10,000 investment over the years.

DateValue
30 Apr 17₹10,000
30 Apr 18₹10,396
30 Apr 19₹10,436
30 Apr 20₹10,429
30 Apr 21₹10,994
30 Apr 22₹12,151

UTI Dynamic Bond Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for UTI Dynamic Bond Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22

DurationReturns
1 Month 7.4%
3 Month 7.4%
6 Month 7%
1 Year 18.4%
3 Year 7.6%
5 Year 5.3%
10 Year
15 Year
Since launch 8%
Historical performance (Yearly) on absolute basis
YearReturns
2021 10.8%
2020 5.9%
2019 -3.9%
2018 5.2%
2017 4.2%
2016 14.9%
2015 6.9%
2014 14.7%
2013 7.6%
2012 11.2%
Fund Manager information for UTI Dynamic Bond Fund
NameSinceTenure
Sudhir Agarwal1 Dec 210.41 Yr.

Data below for UTI Dynamic Bond Fund as on 30 Apr 22

Asset Allocation
Asset ClassValue
Cash33.3%
Debt66.7%
Debt Sector Allocation
SectorValue
Government46.31%
Corporate27.06%
Cash Equivalent26.62%
Credit Quality
RatingValue
AA10.21%
AAA74.7%
Below B15.09%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
5.53% Govt Stock 2033
Sovereign Bonds | -
11%₹40 Cr400,000,000
6.54% Govt Stock 2032
Sovereign Bonds | -
8%₹29 Cr300,000,000
↑ 300,000,000
National Bank For Agriculture And Rural Development
Debentures | -
7%₹25 Cr250
5.22% Govt Stock 2025
Sovereign Bonds | -
7%₹24 Cr250,000,000
Jorabat Shillong Expressway Limited
Debentures | -
6%₹23 Cr4,619
Jorabat Shillong Expressway Limited
Debentures | -
6%₹21 Cr4,282
182 Dtb 15092022
Sovereign Bonds | -
5%₹20 Cr200,000,000
6.1% Govt Stock 2031
Sovereign Bonds | -
5%₹18 Cr200,000,000
↑ 200,000,000
Piramal Capital & Housing Finance Limited
Debentures | -
3%₹10 Cr123,219
Punjab National Bank
Debentures | -
3%₹10 Cr100

2. PGIM India Credit Risk Fund

(Erstwhile DHFL Pramerica Credit Opportunities Fund)

The investment objective of the Scheme is to generate income and capital appreciation by investing predominantly in corporate debt. There can be no assurance that the investment objective of the Scheme will be realized.

PGIM India Credit Risk Fund is a Debt - Credit Risk fund was launched on 29 Sep 14. It is a fund with Moderate risk and has given a CAGR/Annualized return of 6.3% since its launch.  Ranked 2 in Credit Risk category. .

Below is the key information for PGIM India Credit Risk Fund

PGIM India Credit Risk Fund
Growth
Launch Date 29 Sep 14
NAV (21 Jan 22) ₹15.5876 ↑ 0.00   (0.01 %)
Net Assets (Cr) ₹39 on 31 Dec 21
Category Debt - Credit Risk
AMC Pramerica Asset Managers Private Limited
Rating
Risk Moderate
Expense Ratio 1.85
Sharpe Ratio 1.73
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load 0-1 Years (1%),1 Years and above(NIL)
Yield to Maturity 5.01%
Effective Maturity 7 Months 2 Days
Modified Duration 6 Months 14 Days

Growth of 10,000 investment over the years.

DateValue
30 Apr 17₹10,000
30 Apr 18₹10,596
30 Apr 19₹11,155
30 Apr 20₹10,531
30 Apr 21₹11,446

PGIM India Credit Risk Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹194,235.
Net Profit of ₹14,235
Invest Now

Returns for PGIM India Credit Risk Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22

DurationReturns
1 Month 0.3%
3 Month 0.6%
6 Month 4.4%
1 Year 8.4%
3 Year 3%
5 Year 4.2%
10 Year
15 Year
Since launch 6.3%
Historical performance (Yearly) on absolute basis
YearReturns
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
Fund Manager information for PGIM India Credit Risk Fund
NameSinceTenure

Data below for PGIM India Credit Risk Fund as on 31 Dec 21

Asset Allocation
Asset ClassValue
Debt Sector Allocation
SectorValue
Credit Quality
RatingValue
Top Securities Holdings / Portfolio
NameHoldingValueQuantity

3. UTI Banking & PSU Debt Fund

The investment objective of the scheme is to generate steady and reasonable income, with low risk and high level of liquidity from a portfolio of predominantly debt & money market securities by Banks and Public Sector Undertakings (PSUs).

UTI Banking & PSU Debt Fund is a Debt - Banking & PSU Debt fund was launched on 3 Feb 14. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7.1% since its launch.  Ranked 3 in Banking & PSU Debt category.  Return for 2021 was 2.8% , 2020 was 8.9% and 2019 was -1% .

Below is the key information for UTI Banking & PSU Debt Fund

UTI Banking & PSU Debt Fund
Growth
Launch Date 3 Feb 14
NAV (20 May 22) ₹17.6067 ↑ 0.01   (0.03 %)
Net Assets (Cr) ₹293 on 30 Apr 22
Category Debt - Banking & PSU Debt
AMC UTI Asset Management Company Ltd
Rating
Risk Moderate
Expense Ratio 0.32
Sharpe Ratio -1.05
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 5.19%
Effective Maturity 1 Year 7 Months 20 Days
Modified Duration 1 Year 4 Months 10 Days

Growth of 10,000 investment over the years.

DateValue
30 Apr 17₹10,000
30 Apr 18₹10,610
30 Apr 19₹10,457
30 Apr 20₹11,342
30 Apr 21₹12,100
30 Apr 22₹12,441

UTI Banking & PSU Debt Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for UTI Banking & PSU Debt Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22

DurationReturns
1 Month 5.7%
3 Month 5.7%
6 Month 6.6%
1 Year 8.3%
3 Year 7.7%
5 Year 5.5%
10 Year
15 Year
Since launch 7.1%
Historical performance (Yearly) on absolute basis
YearReturns
2021 2.8%
2020 8.9%
2019 -1%
2018 6.8%
2017 6.4%
2016 11.7%
2015 8.6%
2014
2013
2012
Fund Manager information for UTI Banking & PSU Debt Fund
NameSinceTenure
Anurag Mittal1 Dec 210.41 Yr.

Data below for UTI Banking & PSU Debt Fund as on 30 Apr 22

Asset Allocation
Asset ClassValue
Cash29.1%
Debt70.9%
Debt Sector Allocation
SectorValue
Government42.8%
Cash Equivalent29.1%
Corporate28.1%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
HDFC Bank Limited
Debentures | -
9%₹26 Cr250
Export Import Bank Of India
Debentures | -
9%₹26 Cr250
Power Finance Corporation Ltd.
Debentures | -
9%₹25 Cr250
Axis Bank Limited
Debentures | -
7%₹20 Cr200
Indian Railway Finance Corporation Limited
Debentures | -
7%₹20 Cr200
Oil And Natural Gas Corporation Limited
Debentures | -
5%₹15 Cr150
National Bank For Agriculture And Rural Development
Debentures | -
5%₹15 Cr150
Housing And Urban Development Corporation Limited
Debentures | -
4%₹13 Cr125
Hindustan Petroleum Corporation Limited
Debentures | -
4%₹10 Cr100
Small Industries Development Bank Of India
Debentures | -
3%₹10 Cr100

4. Baroda Pioneer Treasury Advantage Fund

The main objective of the scheme is to provide optimal returns and liquidity through a portfolio comprising of debt securities and money market instruments.

Baroda Pioneer Treasury Advantage Fund is a Debt - Low Duration fund was launched on 24 Jun 09. It is a fund with Moderately Low risk and has given a CAGR/Annualized return of 3.8% since its launch.  Ranked 4 in Low Duration category. .

Below is the key information for Baroda Pioneer Treasury Advantage Fund

Baroda Pioneer Treasury Advantage Fund
Growth
Launch Date 24 Jun 09
NAV (13 Mar 22) ₹1,600.39 ↑ 0.30   (0.02 %)
Net Assets (Cr) ₹28 on 31 Jan 22
Category Debt - Low Duration
AMC Baroda Pioneer Asset Management Co. Ltd.
Rating
Risk Moderately Low
Expense Ratio 0.89
Sharpe Ratio 0.37
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 4.07%
Effective Maturity 8 Months 1 Day
Modified Duration 7 Months 17 Days

Growth of 10,000 investment over the years.

DateValue
30 Apr 17₹10,000
30 Apr 18₹10,694
30 Apr 19₹11,406
30 Apr 20₹6,405
30 Apr 21₹8,184

Baroda Pioneer Treasury Advantage Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%

Returns for Baroda Pioneer Treasury Advantage Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22

DurationReturns
1 Month 0.2%
3 Month 0.7%
6 Month 1.2%
1 Year 3.7%
3 Year -9.5%
5 Year -3.2%
10 Year
15 Year
Since launch 3.8%
Historical performance (Yearly) on absolute basis
YearReturns
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
Fund Manager information for Baroda Pioneer Treasury Advantage Fund
NameSinceTenure

Data below for Baroda Pioneer Treasury Advantage Fund as on 31 Jan 22

Asset Allocation
Asset ClassValue
Debt Sector Allocation
SectorValue
Credit Quality
RatingValue
Top Securities Holdings / Portfolio
NameHoldingValueQuantity

5. Aditya Birla Sun Life Savings Fund

The primary objective of the schemes is to generate regular income through investments in debt and money market instruments. Income maybe generated through the receipt of coupon payments or the purchase and sale of securities in the underlying portfolio. The schemes will under normal market conditions, invest its net assets in fixed income securities, money market instruments, cash and cash equivalents.

Aditya Birla Sun Life Savings Fund is a Debt - Ultrashort Bond fund was launched on 16 Apr 03. It is a fund with Moderately Low risk and has given a CAGR/Annualized return of 7.5% since its launch.  Ranked 6 in Ultrashort Bond category.  Return for 2021 was 3.9% , 2020 was 7% and 2019 was 8.5% .

Below is the key information for Aditya Birla Sun Life Savings Fund

Aditya Birla Sun Life Savings Fund
Growth
Launch Date 16 Apr 03
NAV (20 May 22) ₹441.001 ↑ 0.06   (0.01 %)
Net Assets (Cr) ₹16,109 on 15 May 22
Category Debt - Ultrashort Bond
AMC Birla Sun Life Asset Management Co Ltd
Rating
Risk Moderately Low
Expense Ratio 0.47
Sharpe Ratio 1.84
Information Ratio 0
Alpha Ratio 0
Min Investment 1,000
Min SIP Investment 1,000
Exit Load NIL
Yield to Maturity 5.04%
Effective Maturity 6 Months
Modified Duration 5 Months 26 Days

Growth of 10,000 investment over the years.

DateValue
30 Apr 17₹10,000
30 Apr 18₹10,692
30 Apr 19₹11,579
30 Apr 20₹12,436
30 Apr 21₹13,245
30 Apr 22₹13,782

Aditya Birla Sun Life Savings Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹200,132.
Net Profit of ₹20,132
Invest Now

Returns for Aditya Birla Sun Life Savings Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22

DurationReturns
1 Month 0%
3 Month 0.6%
6 Month 1.7%
1 Year 3.7%
3 Year 5.7%
5 Year 6.5%
10 Year
15 Year
Since launch 7.5%
Historical performance (Yearly) on absolute basis
YearReturns
2021 3.9%
2020 7%
2019 8.5%
2018 7.6%
2017 7.2%
2016 9.2%
2015 8.9%
2014 9.7%
2013 9.5%
2012 9.7%
Fund Manager information for Aditya Birla Sun Life Savings Fund
NameSinceTenure
Sunaina Cunha14 Jun 147.88 Yr.
Kaustubh Gupta15 Jul 1110.8 Yr.
Monika Gandhi22 Mar 211.11 Yr.

Data below for Aditya Birla Sun Life Savings Fund as on 15 May 22

Asset Allocation
Asset ClassValue
Cash64.1%
Debt35.9%
Debt Sector Allocation
SectorValue
Corporate42.72%
Cash Equivalent37.34%
Government19.94%
Credit Quality
RatingValue
AA13.01%
AAA86.99%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Housing Development Finance Corporation Limited
Debentures | -
4%₹602 Cr6,000
182 Dtb 08092022
Sovereign Bonds | -
2%₹394 Cr40,000,000
8.15% Govt Stock 2022
Sovereign Bonds | -
2%₹296 Cr29,500,000
Shriram Transport Finance Company Limited
Debentures | -
2%₹280 Cr2,750
Indusind Bank Limited
Debentures | -
2%₹269 Cr5,500
↑ 5,500
Reliance Industries Limited
Debentures | -
2%₹258 Cr2,500
Housing Development Finance Corporation Limited
Debentures | -
2%₹246 Cr2,450
08.21 HR UDAY 2023
Domestic Bonds | -
1%₹236 Cr23,000,000
08.24 GJ Sdl 2023
Sovereign Bonds | -
1%₹216 Cr21,000,000
08.18 HR UDAY 2022
Domestic Bonds | -
1%₹211 Cr21,000,000

How to Evaluate Best Debt Mutual Funds

In order to select the best debt funds you wish to invest in, it is necessary to consider some of the important parameters such as average maturity, credit quality, AUM, expense ratio, tax implication., etc. Let's have an in-depth look-

1. Average Maturity/Duration

Average maturity is an essential parameter in debt funds that is sometimes overlooked by investors, who tend to invest for a long period without considering the risks involved. Investors need to decide their debt fund investment based on its maturity period, Matching the time period of investment with the maturity period of the debt fund is a good way to ensure you don't end up taking unnecessary risk. Thus, it is advisable to know the average maturity of a debt fund, before investing, in order to aim for optimum risk returns in debt funds. Looking at the average maturity (duration is a similar factor) is important, for example, a liquid fund may have an average maturity of a couple of days to maybe a month, this would mean it is a great option for an investor who is looking to invest money for a couple of days. Similarly, if you are looking at the time frame of one-year Investment plan then, a short-term debt fund can be ideal.

2. Interest Rate Scenario

Understanding the market environment is very important in debt funds which are affected by interest rates and its fluctuations. When the interest rate rises in the economy, the bond price falls and vice-versa. Also, during the time when the interest rates rise, new bonds are issued in the market with a higher yield than the older bonds, making those older bonds of lower value. Therefore, investors are more attracted towards newer bonds in the market and also a re-pricing of older bonds takes place. In case a debt fund is having an exposure to such "older bonds" then when the interest rates rise, the NAV of the debt fund would be impacted negatively. Furthermore, as debt funds are exposed to interest rate fluctuations, it disturbs the prices of the underlying bonds in the fund portfolio. For instance, long-term debt funds are at a higher risk during times of rising interest rates. During this time making a short-term investment plan will lower your interest rate risks.

If one has good knowledge of interest rates and can monitor the same, one can even take advantage of this. In a falling interest rate market, long-term debt funds would be a good choice. However, during the times of rising interest rates then it would be wise to be in funds with shorter average maturities like short-term funds, Ultra Short Term fund or even liquid funds.

3. Current Yield or Portfolio Yield

The yield is a measure of the interest income generated by the bonds in the portfolio. Funds that invest in debt or bonds that have a higher coupon rate (or yield) would have a higher overall portfolio yield. The yield to maturity(ytm) of a debt mutual fund indicates the running yield of the fund. When comparing debt funds on the basis of YTM, one should also look at that fact that how is the extra yield being generated. Is this at the cost of as lower portfolio quality? Investing in not so good quality instruments has its own issues. You don't want to end up investing in a debt fund which has such bonds or securities that may Default later on. So, always look at the portfolio yield and balance it off with the credit quality.

How-to-select-best-debt-funds

4. Credit Quality of Portfolio

In order to invest in best debt funds, checking the credit quality of the bonds and debt securities is an essential parameter. Bonds are assigned a credit rating by various agencies based on their ability to pay the money back. A bond with AAA rating is considered to be the best credit rating and also implies a safe and secure investment. If one truly wants safety and considers this as the paramount parameter in selecting the best debt fund, then getting into a fund with very high-quality debt instruments (AAA or AA+) may be the desired option.

5. Assets Under Management (AUM)

This is the foremost parameter to consider while choosing the best debt funds. AUM is the total amount invested in a particular scheme by all investors. Since, most Mutual Funds’ total AUM is invested in debt funds, investors need to select scheme assets that have a considerable AUM. Being in a fund which has a large exposure to corporates may be risky, since their withdrawals may be large which may affect the overall fund performance.

6. Expense Ratio

An important factor to be considered in debt funds is its expense ratio. A higher expense ratio creates a larger impact on the funds’ performance. For example, liquid funds have the lowest expense ratios which are up to 50 bps (BPS is a unit to measure interest rates wherein one bps is equal to 1/100th of 1%) whereas, other debt funds could charge up to 150 bps. So to make a choice between one debt mutual fund, it is important to consider the management fee or the fund running expense.

7. Taxation Impacts

Debt funds offer the benefit of long-term capital gains (more than 3 years) with indexation benefits. And the short term capital gains (less than 3 years) is taxed at 30%.

Things to consider as an investor

1. Fund Objectives

Debt Fund aims to earn optimal returns by maintaining a diversified portfolio of various types of securities. You can expect them to perform in a predictable manner. It is because of this reason, that debt funds are popular among conservative investors.

2. Fund Types

Debt funds are further divided into various categories like liquid funds, Monthly Income Plan (MIP), fixed maturity plans (FMP), Dynamic Bond Funds, income funds, credit opportunities funds, GILT funds, short-term funds and ultra short-term funds.

3. Risks

Debt funds are basically exposed to interest rate risk, credit risk, and liquidity risk. The fund value may fluctuate due to the overall interest rate movements. There’s a risk of default in the payment of interest and principal by the issuer. Liquidity risk happens when the fund manager is unable to sell the underlying security due to lack of demand.

4. Cost

Debt funds charge an expense ratio to manage your money. Till now SEBI had mandated the upper limit of expense ratio to be 2.25% (Might change time to time with regulations.).

5. Investment Horizon

An investment of 3 months to 1 year would be ideal for liquid funds. If you have a longer horizon of say 2 to 3 years, you may go for short-term bond funds.

6. Financial Goals

Debt funds can be used to achieve a variety of goals like earning additional income or for purpose of liquidity.

How to Invest in Best Debt Funds Online?

  1. Open Free Investment Account for Lifetime at Fincash.com.

  2. Complete your Registration and KYC Process

  3. Upload Documents (PAN, Aadhaar, etc.). And, You are Ready to Invest!

    Get Started

Conclusion

Debt funds are one of the best ways to invest your money and generate income on a regular basis by choosing the relevant product matching your risk profile. So, investors looking to generate steady income or take advantage of the debt markets, can consider the above best debt funds for 2022 - 2023 and start investing!_

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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Amol Vyas, posted on 14 Jan 19 5:50 PM

The article is nice and informative but it could be in more simple words because lot of people have much less knowledge in such sector

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