+91-22-489139096 Best Debt Mutual Funds for Lump sum Investments 2026
Debt Mutual Fund schemes in India have grown over the years. As a result, the best performing mutual debt funds in the market keep on changing. There are various rating systems in place to judge a mutual fund scheme, namely CRISIL, Morning Star, ICRA. These systems evaluate a mutual fund in terms of returns, standard deviation, credit quality of securities, rate movement guidance by RBI, etc.
Why To Invest Lump Sum in Debt Mutual Funds?
- Better return than prevailing Fixed Deposit (FD) & Recurring deposit (RD) rates across banks
- Returns are linked to debt markets
- Immediate (T+1) redemption online
- Indexation (Debt Taxation benefits) benefits on returns over three years
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Best Lumpsum Debt Mutual Funds FY 26 - 27
Below are the top ranked funds from Debt Categories primarily funds having AUM > 500 Crore & are in Ultra-short, Corporate bond, Credit Risk, Low Duration sub categories && Having maturity of less than 3 years and providing highest yields.
Fund Selection Methodology used to find 6 funds
Top 6 Lump sum Debt Mutual Funds
Fund NAV Net Assets (Cr) Min Investment 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 2024 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity Nippon India Credit Risk Fund Growth ₹36.8061
↓ -0.02 ₹1,031 500 1.7 3.7 9 8.5 8.9 8.73% 2Y 25D 2Y 5M 12D SBI Credit Risk Fund Growth ₹47.5919
↓ -0.03 ₹2,164 5,000 1.3 3.1 7.8 8.2 7.9 8.66% 1Y 11M 26D 2Y 6M 7D Kotak Credit Risk Fund Growth ₹30.922
↓ -0.07 ₹706 5,000 1.1 3.6 8.8 7.8 9.1 8.22% 2Y 2M 12D 2Y 9M 11D Mahindra Low Duration Bachat Yojana Growth ₹1,696.23
↓ -0.44 ₹582 1,000 1.1 2.6 6.6 6.9 6.9 7.44% 10M 3D 11M 8D Kotak Low Duration Fund Growth ₹3,470.55
↓ -0.61 ₹14,796 5,000 1.1 2.6 6.7 6.9 7 7.42% 10M 13D 1Y 4M 6D HDFC Low Duration Fund Growth ₹60.0166
↓ -0.02 ₹25,366 5,000 1.2 2.8 6.9 7.2 7.2 7.37% 10M 26D 1Y 10M 13D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 4 Mar 26 Research Highlights & Commentary of 6 Funds showcased
Commentary Nippon India Credit Risk Fund SBI Credit Risk Fund Kotak Credit Risk Fund Mahindra Low Duration Bachat Yojana Kotak Low Duration Fund HDFC Low Duration Fund Point 1 Lower mid AUM (₹1,031 Cr). Upper mid AUM (₹2,164 Cr). Bottom quartile AUM (₹706 Cr). Bottom quartile AUM (₹582 Cr). Upper mid AUM (₹14,796 Cr). Highest AUM (₹25,366 Cr). Point 2 Established history (20+ yrs). Established history (21+ yrs). Established history (15+ yrs). Established history (9+ yrs). Established history (18+ yrs). Oldest track record among peers (26 yrs). Point 3 Rating: 2★ (bottom quartile). Top rated. Rating: 3★ (upper mid). Not Rated. Rating: 4★ (upper mid). Rating: 3★ (lower mid). Point 4 Risk profile: Moderate. Risk profile: Moderate. Risk profile: Moderately Low. Risk profile: Moderately Low. Risk profile: Moderate. Risk profile: Moderately Low. Point 5 1Y return: 8.97% (top quartile). 1Y return: 7.83% (upper mid). 1Y return: 8.84% (upper mid). 1Y return: 6.58% (bottom quartile). 1Y return: 6.74% (bottom quartile). 1Y return: 6.91% (lower mid). Point 6 1M return: 0.85% (top quartile). 1M return: 0.56% (upper mid). 1M return: 0.47% (upper mid). 1M return: 0.43% (bottom quartile). 1M return: 0.44% (bottom quartile). 1M return: 0.45% (lower mid). Point 7 Sharpe: 2.16 (top quartile). Sharpe: 1.31 (upper mid). Sharpe: 1.75 (upper mid). Sharpe: 0.89 (bottom quartile). Sharpe: 0.90 (bottom quartile). Sharpe: 1.25 (lower mid). Point 8 Information ratio: 0.00 (top quartile). Information ratio: 0.00 (upper mid). Information ratio: 0.00 (upper mid). Information ratio: 0.00 (lower mid). Information ratio: 0.00 (bottom quartile). Information ratio: 0.00 (bottom quartile). Point 9 Yield to maturity (debt): 8.73% (top quartile). Yield to maturity (debt): 8.66% (upper mid). Yield to maturity (debt): 8.22% (upper mid). Yield to maturity (debt): 7.44% (lower mid). Yield to maturity (debt): 7.42% (bottom quartile). Yield to maturity (debt): 7.37% (bottom quartile). Point 10 Modified duration: 2.07 yrs (bottom quartile). Modified duration: 1.99 yrs (lower mid). Modified duration: 2.20 yrs (bottom quartile). Modified duration: 0.84 yrs (top quartile). Modified duration: 0.87 yrs (upper mid). Modified duration: 0.91 yrs (upper mid). Nippon India Credit Risk Fund
SBI Credit Risk Fund
Kotak Credit Risk Fund
Mahindra Low Duration Bachat Yojana
Kotak Low Duration Fund
HDFC Low Duration Fund
*List of Debt Mutual Funds having net assets > 500 Crore and Fund have assets under manegement for atleast 3 years.
(Erstwhile Reliance Regular Savings Fund - Debt Plan) The primary investment objective of this option is to generate optimal returns consistent with moderate level of risk. This income may be complemented by capital appreciation of the portfolio. Accordingly investments shall predominantly be made in Debt & Money Market Instruments. Below is the key information for Nippon India Credit Risk Fund Returns up to 1 year are on (Erstwhile SBI Corporate Bond Fund) The investment objective will be to actively manage a portfolio of good
quality corporate debt as well as Money Market Instruments so as to provide
reasonable returns and liquidity to the Unit holders. However there is no
guarantee or assurance that the investment objective of the scheme will
be achieved. Research Highlights for SBI Credit Risk Fund Below is the key information for SBI Credit Risk Fund Returns up to 1 year are on (Erstwhile Kotak Income Opportunities Fund) The investment objective of the scheme is to generate income by investing in debt/ and money market securities across the yield curve and credit spectrum. The scheme will also seek to maintain reasonable liquidity within the fund. Research Highlights for Kotak Credit Risk Fund Below is the key information for Kotak Credit Risk Fund Returns up to 1 year are on (Erstwhile Mahindra ALP-Samay Bachat Yojana) The investment objective of the Scheme is to provide reasonable returns, commensurate with a low to moderate level of risk and high degree of liquidity, through a portfolio constituted of money market and debt instruments. However, there is no assurance that the investment objective of the Scheme will be realized and the Scheme does not assure or guarantee any returns. Research Highlights for Mahindra Low Duration Bachat Yojana Below is the key information for Mahindra Low Duration Bachat Yojana Returns up to 1 year are on The primary objective of the Scheme is to generate income through investment
primarily in low duration debt & money market securities. However, there is no
assurance that the objective of the scheme will be realized Research Highlights for Kotak Low Duration Fund Below is the key information for Kotak Low Duration Fund Returns up to 1 year are on (Erstwhile HDFC Cash Management Fund - Treasury Advantage Plan) To generate regular income through investment in debt securities and money market instruments. Research Highlights for HDFC Low Duration Fund Below is the key information for HDFC Low Duration Fund Returns up to 1 year are on 1. Nippon India Credit Risk Fund
Nippon India Credit Risk Fund
Growth Launch Date 8 Jun 05 NAV (04 Mar 26) ₹36.8061 ↓ -0.02 (-0.06 %) Net Assets (Cr) ₹1,031 on 31 Jan 26 Category Debt - Credit Risk AMC Nippon Life Asset Management Ltd. Rating ☆☆ Risk Moderate Expense Ratio 1.46 Sharpe Ratio 2.16 Information Ratio 0 Alpha Ratio 0 Min Investment 500 Min SIP Investment 100 Exit Load 0-12 Months (1%),12 Months and above(NIL) Yield to Maturity 8.73% Effective Maturity 2 Years 5 Months 12 Days Modified Duration 2 Years 25 Days Growth of 10,000 investment over the years.
Date Value 28 Feb 21 ₹10,000 28 Feb 22 ₹11,340 28 Feb 23 ₹11,770 29 Feb 24 ₹12,752 28 Feb 25 ₹13,811 28 Feb 26 ₹15,050 Returns for Nippon India Credit Risk Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 4 Mar 26 Duration Returns 1 Month 0.8% 3 Month 1.7% 6 Month 3.7% 1 Year 9% 3 Year 8.5% 5 Year 8.5% 10 Year 15 Year Since launch 6.5% Historical performance (Yearly) on absolute basis
Year Returns 2024 8.9% 2023 8.3% 2022 7.9% 2021 3.9% 2020 13.5% 2019 -5.9% 2018 1.9% 2017 6.1% 2016 7% 2015 10% Fund Manager information for Nippon India Credit Risk Fund
Name Since Tenure Kinjal Desai 25 May 18 7.7 Yr. Sushil Budhia 1 Feb 20 6.01 Yr. Lokesh Maru 5 Sep 25 0.41 Yr. Divya Sharma 5 Sep 25 0.41 Yr. Data below for Nippon India Credit Risk Fund as on 31 Jan 26
Asset Allocation
Asset Class Value Cash 12.38% Debt 87.33% Other 0.29% Debt Sector Allocation
Sector Value Corporate 69.67% Government 17.66% Cash Equivalent 12.38% Credit Quality
Rating Value A 29.3% AA 37.99% AAA 32.71% Top Securities Holdings / Portfolio
Name Holding Value Quantity 7.02% Gs 2031
Sovereign Bonds | -7% ₹77 Cr 7,500,000 Renew Solar Energy (Jharkhand Five) Private Limited
Debentures | -5% ₹47 Cr 5,000 TRuhome Finance Limited
Debentures | -4% ₹41 Cr 4,000 Navi Finserv Limited
Debentures | -4% ₹40 Cr 40,000 GAursons India Private Limited
Debentures | -4% ₹40 Cr 4,000 The Sandur Manganese And Iron Ores Limited
Debentures | -4% ₹37 Cr 4,000 Mancherial Repallewada Road Private Limited
Debentures | -3% ₹36 Cr 4,500 Delhi International Airport Limited
Debentures | -3% ₹36 Cr 3,500 Vedanta Limited
Debentures | -3% ₹35 Cr 3,500 Renserv Global Private Limited
Debentures | -3% ₹35 Cr 3,500 2. SBI Credit Risk Fund
SBI Credit Risk Fund
Growth Launch Date 19 Jul 04 NAV (04 Mar 26) ₹47.5919 ↓ -0.03 (-0.07 %) Net Assets (Cr) ₹2,164 on 31 Jan 26 Category Debt - Credit Risk AMC SBI Funds Management Private Limited Rating ☆☆☆☆ Risk Moderate Expense Ratio 1.55 Sharpe Ratio 1.31 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-12 Months (3%),12-24 Months (1.5%),24-36 Months (0.75%),36 Months and above(NIL) Yield to Maturity 8.66% Effective Maturity 2 Years 6 Months 7 Days Modified Duration 1 Year 11 Months 26 Days Growth of 10,000 investment over the years.
Date Value 28 Feb 21 ₹10,000 28 Feb 22 ₹10,585 28 Feb 23 ₹11,036 29 Feb 24 ₹12,016 28 Feb 25 ₹12,958 28 Feb 26 ₹13,991 Returns for SBI Credit Risk Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 4 Mar 26 Duration Returns 1 Month 0.6% 3 Month 1.3% 6 Month 3.1% 1 Year 7.8% 3 Year 8.2% 5 Year 6.9% 10 Year 15 Year Since launch 7.5% Historical performance (Yearly) on absolute basis
Year Returns 2024 7.9% 2023 8.1% 2022 8.3% 2021 4.2% 2020 5% 2019 9.8% 2018 6.5% 2017 6.2% 2016 6.9% 2015 10.5% Fund Manager information for SBI Credit Risk Fund
Name Since Tenure Lokesh Mallya 1 Feb 17 9.01 Yr. Data below for SBI Credit Risk Fund as on 31 Jan 26
Asset Allocation
Asset Class Value Cash 14.08% Equity 4.2% Debt 81.34% Other 0.38% Debt Sector Allocation
Sector Value Corporate 64.06% Government 17.28% Cash Equivalent 14.08% Credit Quality
Rating Value A 18.19% AA 60.03% AAA 21.78% Top Securities Holdings / Portfolio
Name Holding Value Quantity 7.02% Gs 2031
Sovereign Bonds | -7% ₹153 Cr 15,000,000 Infopark Properties Limited
Debentures | -5% ₹105 Cr 10,500 Renew Solar Energy (Jharkhand Five) Private Limited
Debentures | -5% ₹103 Cr 11,000 H.G. Infra Engineering Limited
Debentures | -5% ₹99 Cr 10,000 Nj Capital Private Limited
Debentures | -5% ₹99 Cr 10,000 6.48% Gs 2035
Sovereign Bonds | -5% ₹98 Cr 10,000,000 Jtpm Metal TRaders Limited
Debentures | -4% ₹93 Cr 9,000 Renserv Global Private Limited
Debentures | -4% ₹80 Cr 8,000 Avanse Financial Services Limited
Debentures | -4% ₹80 Cr 8,000 The Sandur Manganese And Iron Ores Limited
Debentures | -4% ₹80 Cr 8,500 3. Kotak Credit Risk Fund
Kotak Credit Risk Fund
Growth Launch Date 11 May 10 NAV (04 Mar 26) ₹30.922 ↓ -0.07 (-0.23 %) Net Assets (Cr) ₹706 on 31 Jan 26 Category Debt - Credit Risk AMC Kotak Mahindra Asset Management Co Ltd Rating ☆☆☆ Risk Moderately Low Expense Ratio 1.71 Sharpe Ratio 1.75 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 8.22% Effective Maturity 2 Years 9 Months 11 Days Modified Duration 2 Years 2 Months 12 Days Growth of 10,000 investment over the years.
Date Value 28 Feb 21 ₹10,000 28 Feb 22 ₹10,620 28 Feb 23 ₹10,655 29 Feb 24 ₹11,514 28 Feb 25 ₹12,280 28 Feb 26 ₹13,379 Returns for Kotak Credit Risk Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 4 Mar 26 Duration Returns 1 Month 0.5% 3 Month 1.1% 6 Month 3.6% 1 Year 8.8% 3 Year 7.8% 5 Year 5.9% 10 Year 15 Year Since launch 7.4% Historical performance (Yearly) on absolute basis
Year Returns 2024 9.1% 2023 7.1% 2022 6.4% 2021 0.9% 2020 5.3% 2019 6.6% 2018 9% 2017 6.2% 2016 6.6% 2015 10.4% Fund Manager information for Kotak Credit Risk Fund
Name Since Tenure Deepak Agrawal 11 May 10 15.74 Yr. Vihag Mishra 24 Oct 25 0.27 Yr. Data below for Kotak Credit Risk Fund as on 31 Jan 26
Asset Allocation
Asset Class Value Cash 4.88% Equity 9.87% Debt 84.67% Other 0.58% Debt Sector Allocation
Sector Value Corporate 71.29% Government 13.38% Cash Equivalent 4.88% Credit Quality
Rating Value A 11.73% AA 61.24% AAA 27.03% Top Securities Holdings / Portfolio
Name Holding Value Quantity 6.48% Gs 2035
Sovereign Bonds | -8% ₹54 Cr 5,465,000
↑ 5,465,000 Jubilant Bevco Limited
Debentures | -8% ₹54 Cr 500 Bamboo Hotel And Global Centre (Delhi) Private Limited
Debentures | -7% ₹50 Cr 5,000 Vedanta Limited
Debentures | -7% ₹50 Cr 5,000 TATA Projects Limited
Debentures | -7% ₹50 Cr 5,000 Rec Limited
Debentures | -7% ₹50 Cr 5,000 Aditya Birla Real Estate Limited
Debentures | -6% ₹45 Cr 4,500 Aditya Birla Renewables Limited
Debentures | -6% ₹40 Cr 4,000 Au Small Finance Bank Limited
Debentures | -4% ₹30 Cr 30 Embassy Office Parks REIT (Real Estate)
-, Since 30 Apr 25 | EMBASSY4% ₹28 Cr 636,630 4. Mahindra Low Duration Bachat Yojana
Mahindra Low Duration Bachat Yojana
Growth Launch Date 15 Feb 17 NAV (04 Mar 26) ₹1,696.23 ↓ -0.44 (-0.03 %) Net Assets (Cr) ₹582 on 31 Jan 26 Category Debt - Low Duration AMC Mahindra Asset Management Company Pvt. Ltd. Rating Risk Moderately Low Expense Ratio 1.09 Sharpe Ratio 0.89 Information Ratio 0 Alpha Ratio 0 Min Investment 1,000 Min SIP Investment 500 Exit Load NIL Yield to Maturity 7.44% Effective Maturity 11 Months 8 Days Modified Duration 10 Months 3 Days Growth of 10,000 investment over the years.
Date Value 28 Feb 21 ₹10,000 28 Feb 22 ₹10,344 28 Feb 23 ₹10,770 29 Feb 24 ₹11,513 28 Feb 25 ₹12,332 28 Feb 26 ₹13,146 Returns for Mahindra Low Duration Bachat Yojana
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 4 Mar 26 Duration Returns 1 Month 0.4% 3 Month 1.1% 6 Month 2.6% 1 Year 6.6% 3 Year 6.9% 5 Year 5.6% 10 Year 15 Year Since launch 6% Historical performance (Yearly) on absolute basis
Year Returns 2024 6.9% 2023 7.2% 2022 6.7% 2021 3.7% 2020 3.1% 2019 6.3% 2018 7.9% 2017 6.5% 2016 2015 Fund Manager information for Mahindra Low Duration Bachat Yojana
Name Since Tenure Rahul Pal 15 Feb 17 8.97 Yr. Amit Garg 1 Jan 26 0.08 Yr. Data below for Mahindra Low Duration Bachat Yojana as on 31 Jan 26
Asset Allocation
Asset Class Value Cash 22.64% Debt 77.06% Other 0.31% Debt Sector Allocation
Sector Value Corporate 75.93% Cash Equivalent 15.48% Government 8.28% Credit Quality
Rating Value AA 34.71% AAA 65.29% Top Securities Holdings / Portfolio
Name Holding Value Quantity Godrej Properties Limited
Debentures | -5% ₹27 Cr 2,700,000 Embassy Office Parks Reit
Debentures | -4% ₹25 Cr 2,500,000 LIC Housing Finance Ltd
Debentures | -4% ₹25 Cr 2,500,000 Bajaj Housing Finance Limited
Debentures | -4% ₹25 Cr 2,500,000 Rec Limited
Debentures | -4% ₹25 Cr 2,500,000 360 One Prime Limited
Debentures | -4% ₹24 Cr 2,400,000 Godrej Industries Limited
Debentures | -4% ₹24 Cr 2,350,000 TVS Credit Services Limited
Debentures | -3% ₹20 Cr 2,000,000 Muthoot Finance Limited
Debentures | -3% ₹20 Cr 2,000,000 Small Industries Development Bank Of India
Debentures | -3% ₹20 Cr 2,000,000 5. Kotak Low Duration Fund
Kotak Low Duration Fund
Growth Launch Date 6 Mar 08 NAV (04 Mar 26) ₹3,470.55 ↓ -0.61 (-0.02 %) Net Assets (Cr) ₹14,796 on 31 Jan 26 Category Debt - Low Duration AMC Kotak Mahindra Asset Management Co Ltd Rating ☆☆☆☆ Risk Moderate Expense Ratio 1.17 Sharpe Ratio 0.9 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 1,000 Exit Load NIL Yield to Maturity 7.42% Effective Maturity 1 Year 4 Months 6 Days Modified Duration 10 Months 13 Days Growth of 10,000 investment over the years.
Date Value 28 Feb 21 ₹10,000 28 Feb 22 ₹10,382 28 Feb 23 ₹10,831 29 Feb 24 ₹11,579 28 Feb 25 ₹12,417 28 Feb 26 ₹13,253 Returns for Kotak Low Duration Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 4 Mar 26 Duration Returns 1 Month 0.4% 3 Month 1.1% 6 Month 2.6% 1 Year 6.7% 3 Year 6.9% 5 Year 5.8% 10 Year 15 Year Since launch 7.2% Historical performance (Yearly) on absolute basis
Year Returns 2024 7% 2023 7.3% 2022 6.7% 2021 3.9% 2020 3.5% 2019 7.9% 2018 8.3% 2017 7.3% 2016 7.1% 2015 8.9% Fund Manager information for Kotak Low Duration Fund
Name Since Tenure Deepak Agrawal 31 Jan 15 11.01 Yr. Dharmesh Thakkar 24 Oct 25 0.27 Yr. Data below for Kotak Low Duration Fund as on 31 Jan 26
Asset Allocation
Asset Class Value Cash 26.99% Debt 72.72% Other 0.29% Debt Sector Allocation
Sector Value Corporate 62.22% Government 18.97% Cash Equivalent 18.52% Credit Quality
Rating Value AA 14.69% AAA 85.31% Top Securities Holdings / Portfolio
Name Holding Value Quantity National Bank For Agriculture And Rural Development
Debentures | -3% ₹478 Cr 47,500 National Bank For Agriculture And Rural Development
Debentures | -3% ₹453 Cr 45,000 Goi Floating Rate Bond 2033
Sovereign Bonds | -3% ₹446 Cr 43,148,779 Jtpm Metal TRaders Limited
Debentures | -3% ₹413 Cr 40,000 Bajaj Housing Finance Limited
Debentures | -3% ₹402 Cr 40,000 Jamnagar Utilities & Power Private Limited
Debentures | -3% ₹380 Cr 3,830 Bajaj Housing Finance Limited
Debentures | -2% ₹258 Cr 26,000 7.46% Madhyapradesh 2027
Sovereign Bonds | -2% ₹255 Cr 25,000,000 19/03/2026 Maturing 364 DTB
Sovereign Bonds | -2% ₹248 Cr 25,000,000 Rec Limited
Debentures | -2% ₹248 Cr 25,000 6. HDFC Low Duration Fund
HDFC Low Duration Fund
Growth Launch Date 18 Nov 99 NAV (04 Mar 26) ₹60.0166 ↓ -0.02 (-0.03 %) Net Assets (Cr) ₹25,366 on 31 Jan 26 Category Debt - Low Duration AMC HDFC Asset Management Company Limited Rating ☆☆☆ Risk Moderately Low Expense Ratio 1.03 Sharpe Ratio 1.25 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 300 Exit Load NIL Yield to Maturity 7.37% Effective Maturity 1 Year 10 Months 13 Days Modified Duration 10 Months 26 Days Growth of 10,000 investment over the years.
Date Value 28 Feb 21 ₹10,000 28 Feb 22 ₹10,385 28 Feb 23 ₹10,856 29 Feb 24 ₹11,645 28 Feb 25 ₹12,498 28 Feb 26 ₹13,364 Returns for HDFC Low Duration Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 4 Mar 26 Duration Returns 1 Month 0.4% 3 Month 1.2% 6 Month 2.8% 1 Year 6.9% 3 Year 7.2% 5 Year 6% 10 Year 15 Year Since launch 7.1% Historical performance (Yearly) on absolute basis
Year Returns 2024 7.2% 2023 7.4% 2022 7% 2021 4.1% 2020 3.7% 2019 8.1% 2018 8% 2017 6.5% 2016 6.4% 2015 8.6% Fund Manager information for HDFC Low Duration Fund
Name Since Tenure Anupam Joshi 27 Oct 15 10.27 Yr. Praveen Jain 6 Oct 22 3.33 Yr. Dhruv Muchhal 22 Jun 23 2.62 Yr. Data below for HDFC Low Duration Fund as on 31 Jan 26
Asset Allocation
Asset Class Value Cash 11.99% Debt 87.73% Other 0.28% Debt Sector Allocation
Sector Value Corporate 64.34% Government 24.33% Cash Equivalent 11.05% Credit Quality
Rating Value AA 13.51% AAA 86.49% Top Securities Holdings / Portfolio
Name Holding Value Quantity Goi Floating Rate Bond 2031
Sovereign Bonds | -5% ₹1,260 Cr 123,000,000
↑ 500,000 Goi Floating Rate Bond 2033
Sovereign Bonds | -4% ₹1,084 Cr 105,000,000 Sikka Ports & Terminals Limited
Debentures | -3% ₹718 Cr 7,200
↓ -500 Jubilant Beverages Limited
Debentures | -3% ₹639 Cr 59,740 National Bank For Agriculture And Rural Development
Debentures | -3% ₹629 Cr 62,500 Rec Limited
Debentures | -2% ₹520 Cr 52,000 National Bank For Agriculture And Rural Development
Debentures | -2% ₹473 Cr 47,000 Small Industries Development Bank Of India
Debentures | -2% ₹433 Cr 43,000 National Housing Bank
Debentures | -2% ₹425 Cr 42,500 National Housing Bank
Debentures | -2% ₹424 Cr 42,100
Smart Tips to Look for in Debt Funds
1. Yield
The yield is a measure of the interest income generated by the Bonds in the Portfolio.
For instance, let's assume that a bond has a face value of INR 100 with an 8 percent coupon rate. This means that the investor will earn INR 8 p.a., on each bond that he invests in. As the bonds are traded in the open market, the price will fluctuate each Business Day. The interest rates rise and fall and demand for the bonds moves up and down. And this impacts the price of the bond. Let’s assume interest rates rise to 10 percent. Even then the investor will continue to earn INR 8. So to increase the yield to 10 percent, which is the current market rate of interest, the price of the bond will have to drop to INR 80.
In another instance, lets assume that the interest rates fall to 6 percent. Again, the investor will continue to earn INR 8. This time the price of the bond will have to go up to INR 133.
If we look at these assumptions, there are two aspects to it- the one is that the yield is not fixed, but fluctuates to changes in the interest rate. The second one is the price of the bond moves inversely to interest rates. It moves to maintain a level where it will attract buyers.
2. Yield to Maturity
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.
3. Modified Duration
Modified duration provides a fair indication of a bond’s sensitivity to a change in interest rates. The higher the duration, the more Volatility the bond exhibits with a change in interest rates
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.
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FAQs
1. How do debt fund managers identify which is high-quality security?
A: Debt fund managers have their techniques for evaluating each bond and assessing the debtor's chances of defaulting to pay the bond. Usually, the higher the credit rating lesser is the chance for the creditor defaulting.
2. Why is debt mutual funds low-risk?
A: Debt mutual funds deal with securities and bonds along other money market instruments. The chances of these instruments failing are usually less, and hence, your investment will remain secure, thereby making debt mutual funds low-risk investments.
3. Do fund managers invest in low-quality securities?
A: Yes, sometimes fund managers do invest in low-quality securities if chances of good ROI exist. However, this will be a calculated risk taken by your fund manager and only if the portfolio of investment already has stable, high-quality securities.
4. Is there any short-term debt mutual fund?
A: Yes, if you opt for a Liquid Fund in which investments are made in money market instruments that have a maturity of 91 days, then you can realize your investment in a matter of three months. This is a short-term investment that you can undertake to get a better understanding of debt mutual funds.
5. Can I invest long-term in a debt mutual fund?
A: Yes, you can invest long-term in debt mutual funds. For example, suppose you invest in the Nippon India Credit Risk Fund or the ICICI Prudential Regular Savings Fund. In that case, it is better that you hold your investment at least for one year, 5 months, and 19 days and 2 years, one month, and 2 days respectively, to get maximum ROI. But you can keep investing beyond that for 3 years.
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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Research Highlights for Nippon India Credit Risk Fund