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Best Government Bond Mutual Funds 2026

Updated on September 27, 2026 , 104437 views

For years, safety meant parking money in fixed deposits.

Best Government Bond Mutual Funds

But in a changing financial world — where interest rates, inflation, and global events move faster than ever — investors are rethinking what “safe” truly means.

That’s where Government Bond Mutual Funds, also called Gilt Funds, come in. These funds invest exclusively in sovereign-backed securities, offering unmatched safety and the potential to earn better returns than traditional fixed-income products.

In simple terms — you lend money to the Indian government and, in return, earn steady interest. And since the government rarely defaults, these funds are considered among the most secure mutual fund categories in India.

What are Government Bond Funds?

When the Government of India needs funds to finance infrastructure, defence, or welfare schemes, it borrows money from investors via the Reserve Bank of India (RBI). The RBI issues Government Securities (G-Secs) — fixed-income instruments with a specified maturity and interest rate.

Gilt Funds are mutual funds that invest exclusively in these G-Secs -

  • Safety - Since they’re backed by the Government of India, the risk of default is almost zero.
  • Returns - Their NAV fluctuates with interest rate movements.
  • Liquidity - They can be easily sold in the market.

In simple terms — when you invest in a gilt fund, you’re lending money to the Indian government and earning interest in return.

🏁 Fact - India’s first gilt fund was launched by Kotak Mahindra AMC in December 1998. Today, these funds have evolved into one of the most sophisticated debt instruments for investors seeking stability.

Why Invest in Govt Bond Funds?

After two years of rate hikes, the RBI has signalled stability. This is good news for debt investors. When interest rates stop rising or start falling, bond prices rise — leading to Capital Gains for gilt fund investors. That’s why these funds often outperform other debt categories during such cycles.

Key Reasons to Consider Gilt Funds -

  • Zero credit risk (backed by Government of India)
  • Potential for capital appreciation when rates fall
  • Diversification — ideal balance to equity-heavy portfolios
  • Long-term wealth stability for conservative investors
  • Transparency — holdings are fully disclosed and rated sovereign

As per AMFI (Jan 2025), Gilt Funds in India collectively manage over ₹1.45 lakh crore, showing strong trust among both retail and institutional investors.

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Types of Government Bond Mutual Funds

Type Description Best For
Short Duration Gilt Funds Invest in short-term government securities (1–3 years) Conservative investors seeking stability
Long Duration Gilt Funds Hold long-term G-Secs (10+ years) Investors betting on falling interest rates
Target Maturity Funds (TMFs) Track specific indices & mature on a fixed date Those who want predictable maturity value
10-Year Constant Maturity Funds Invest in 10-year government securities Moderate investors who prefer duration balance

Analogy - If FDs are like traditional savings, Gilt Funds are like smarter savings — with the same safety but better growth potential.

Economic Context – Why the Timing Matters

Indicator 2023 2024 2025 (Est.)
10-Year G-Sec Yield 7.3% 7.1% 7.2%
Repo Rate 6.5% 6.5% 6.25%
CPI Inflation 5.6% 4.9% 4.6%

India’s inflation cooling off and the RBI’s neutral stance create an ideal environment for steady bond returns. If rates remain stable, gilt funds could deliver 6.5–8% returns, possibly higher if yields decline in the next 12–18 months.

Fund Selection Methodology used to find 9 funds

  • Category: Debt
  • Sub-category: Government%20Bond
  • AUM Range: 20 to 100000 Cr
  • Sorted On : 1-year return (high to low)
  • Tags: nifty, sensex
  • No Of Funds: 4

Best Government Bond Mutual Funds To Invest In 2026

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Bandhan Government Securities Fund - Investment Plan Growth ₹37.5035
↑ 0.02
₹1,850-0.757.17.43.77.54%11Y 4M 24D28Y 4M 6D
UTI Gilt Fund Growth ₹65.5033
↑ 0.16
₹420-0.32.64.46.25.16.15%3Y 6Y 10M 20D
Franklin India Government Securities Fund Growth ₹61.3537
↑ 0.05
₹1480.63.64.45.85.57.11%3Y 8M 16D10Y 4M 20D
Axis Gilt Fund Growth ₹26.5178
↑ 0.04
₹341-13.43.66.75.27.25%8Y 11M 23D22Y 7M 20D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Sep 26

Research Highlights & Commentary of 4 Funds showcased

CommentaryBandhan Government Securities Fund - Investment PlanUTI Gilt FundFranklin India Government Securities FundAxis Gilt Fund
Point 1Highest AUM (₹1,850 Cr).Upper mid AUM (₹420 Cr).Bottom quartile AUM (₹148 Cr).Lower mid AUM (₹341 Cr).
Point 2Established history (17+ yrs).Oldest track record among peers (24 yrs).Established history (24+ yrs).Established history (14+ yrs).
Point 3Rating: 3★ (upper mid).Top rated.Rating: 3★ (lower mid).Rating: 1★ (bottom quartile).
Point 4Risk profile: Moderate.Risk profile: Moderate.Risk profile: Moderate.Risk profile: Moderate.
Point 51Y return: 7.06% (top quartile).1Y return: 4.42% (upper mid).1Y return: 4.40% (lower mid).1Y return: 3.57% (bottom quartile).
Point 61M return: 0.17% (top quartile).1M return: -0.42% (lower mid).1M return: -0.33% (upper mid).1M return: -0.61% (bottom quartile).
Point 7Sharpe: 0.66 (top quartile).Sharpe: 0.26 (lower mid).Sharpe: 0.36 (upper mid).Sharpe: 0.01 (bottom quartile).
Point 8Information ratio: 0.00 (top quartile).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (bottom quartile).
Point 9Yield to maturity (debt): 7.54% (top quartile).Yield to maturity (debt): 6.15% (bottom quartile).Yield to maturity (debt): 7.11% (lower mid).Yield to maturity (debt): 7.25% (upper mid).
Point 10Modified duration: 11.40 yrs (bottom quartile).Modified duration: 3.00 yrs (top quartile).Modified duration: 3.71 yrs (upper mid).Modified duration: 8.98 yrs (lower mid).

Bandhan Government Securities Fund - Investment Plan

  • Highest AUM (₹1,850 Cr).
  • Established history (17+ yrs).
  • Rating: 3★ (upper mid).
  • Risk profile: Moderate.
  • 1Y return: 7.06% (top quartile).
  • 1M return: 0.17% (top quartile).
  • Sharpe: 0.66 (top quartile).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 7.54% (top quartile).
  • Modified duration: 11.40 yrs (bottom quartile).

UTI Gilt Fund

  • Upper mid AUM (₹420 Cr).
  • Oldest track record among peers (24 yrs).
  • Top rated.
  • Risk profile: Moderate.
  • 1Y return: 4.42% (upper mid).
  • 1M return: -0.42% (lower mid).
  • Sharpe: 0.26 (lower mid).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 6.15% (bottom quartile).
  • Modified duration: 3.00 yrs (top quartile).

Franklin India Government Securities Fund

  • Bottom quartile AUM (₹148 Cr).
  • Established history (24+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderate.
  • 1Y return: 4.40% (lower mid).
  • 1M return: -0.33% (upper mid).
  • Sharpe: 0.36 (upper mid).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 7.11% (lower mid).
  • Modified duration: 3.71 yrs (upper mid).

Axis Gilt Fund

  • Lower mid AUM (₹341 Cr).
  • Established history (14+ yrs).
  • Rating: 1★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 3.57% (bottom quartile).
  • 1M return: -0.61% (bottom quartile).
  • Sharpe: 0.01 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 7.25% (upper mid).
  • Modified duration: 8.98 yrs (lower mid).

About the Fincash Research Team

At Fincash, our mission is to help investors make informed, confident decisions. With over 10 years in Mutual Fund distribution, our team blends deep industry expertise with a commitment to transparency, accuracy, and investor education.

Who We Are

AMFI Registration No.
112358
MCA CIN
U74999MH2016PTC282153
Location
Thane, Maharashtra, India
Experience
10+ years in Mutual Fund distribution

Our Expertise

  • Certified Mutual Fund Distributors with hands-on advisory experience.
  • Market analysts tracking performance, macro trends, and sectors.
  • Data specialists processing NAVs, allocations, and risk metrics from Morning Star.

Our Research Process

  • Data sourcing: SEBI-registered fund houses & verified third-party provider Morning Star
  • Screening: Returns, manager track record, expenses, sector mix, risk-adjusted metrics.
  • Expert review: Senior team members review every article and list for accuracy.
  • Updates: Regular refreshes so performance data reflects current market conditions.

Why Trust Us

  • Regulated & compliant: AMFI-registered and MCA-incorporated.
  • Investor-first: No pay-to-promote lists; suitability and performance drive coverage.
  • Education-focused: We simplify complex concepts for everyday investors.

Disclaimer

Content is for educational and informational purposes only and is not investment advice. Please consider your risk profile and consult a financial advisor before investing.

1. Bandhan Government Securities Fund - Investment Plan

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

Research Highlights for Bandhan Government Securities Fund - Investment Plan

  • Highest AUM (₹1,850 Cr).
  • Established history (17+ yrs).
  • Rating: 3★ (upper mid).
  • Risk profile: Moderate.
  • 1Y return: 7.06% (top quartile).
  • 1M return: 0.17% (top quartile).
  • Sharpe: 0.66 (top quartile).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 7.54% (top quartile).
  • Modified duration: 11.40 yrs (bottom quartile).
  • Average maturity: 28.35 yrs (bottom quartile).
  • Exit load: NIL.
  • Higher exposure to Cash Equivalent (bond sector) vs peer median.
  • Conservative stance with elevated cash (~87%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding Triparty Repo Trp_160926 (~86.2%).
  • Top-3 holdings concentration ~99.7%.

Below is the key information for Bandhan Government Securities Fund - Investment Plan

Bandhan Government Securities Fund - Investment Plan
Growth
Launch Date 3 Dec 08
NAV (29 Sep 26) ₹37.5035 ↑ 0.02   (0.06 %)
Net Assets (Cr) ₹1,850 on 15 Aug 26
Category Debt - Government Bond
AMC IDFC Asset Management Company Limited
Rating ☆☆☆
Risk Moderate
Expense Ratio 1.14
Sharpe Ratio 0.66
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load NIL
Yield to Maturity 7.54%
Effective Maturity 28 Years 4 Months 6 Days
Modified Duration 11 Years 4 Months 24 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹10,116
31 Aug 23₹10,715
31 Aug 24₹11,871
31 Aug 25₹12,173
31 Aug 26₹13,241

Bandhan Government Securities Fund - Investment Plan 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 Bandhan Government Securities Fund - Investment Plan

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 29 Sep 26

DurationReturns
1 Month 0.2%
3 Month -0.7%
6 Month 5%
1 Year 7.1%
3 Year 7.4%
5 Year 5.7%
10 Year
15 Year
Since launch 7.7%
Historical performance (Yearly) on absolute basis
YearReturns
2024 3.7%
2023 10.6%
2022 6.8%
2021 1.4%
2020 2.1%
2019 13.7%
2018 13.3%
2017 7.8%
2016 3.1%
2015 13.9%
Fund Manager information for Bandhan Government Securities Fund - Investment Plan
NameSinceTenure
Suyash Choudhary15 Oct 1015.89 Yr.
Brijesh Shah10 Jun 242.22 Yr.

Data below for Bandhan Government Securities Fund - Investment Plan as on 15 Aug 26

Asset Allocation
Asset ClassValue
Cash86.53%
Debt13.47%
Debt Sector Allocation
SectorValue
Cash Equivalent86.53%
Government13.47%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.36% Govt Stock 2052
Sovereign Bonds | -
8%₹130 Cr13,500,000
↓ -500,000
7.3% Govt Stock 2053
Sovereign Bonds | -
6%₹101 Cr10,500,000
↓ -14,500,000
Triparty Repo Trp_160926
CBLO/Reverse Repo | -
86%₹1,477 Cr
Cash Margin - Ccil
CBLO/Reverse Repo | -
0%₹5 Cr
Net Current Assets
Net Current Assets | -
0%₹0 Cr

2. UTI Gilt Fund

(Erstwhile UTI Gilt Advantage Fund- LTP)

To generate credit risk-free return through investment in sovereign securities issued by the Central Government and / or a State Government and / or any security unconditionally guaranteed by the Central Government and / or a State Government for repayment of principal and interest. However there can be no assurance that the investment objective of the Scheme will be achieved.

Research Highlights for UTI Gilt Fund

  • Upper mid AUM (₹420 Cr).
  • Oldest track record among peers (24 yrs).
  • Top rated.
  • Risk profile: Moderate.
  • 1Y return: 4.42% (upper mid).
  • 1M return: -0.42% (lower mid).
  • Sharpe: 0.26 (lower mid).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 6.15% (bottom quartile).
  • Modified duration: 3.00 yrs (top quartile).
  • Average maturity: 6.89 yrs (top quartile).
  • Exit load: NIL.
  • Higher exposure to Government (bond sector) vs peer median.
  • Debt-heavy allocation (~91%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding 6.9% Govt Stock 2065 (~44.3%).
  • Top-3 holdings concentration ~74.5%.

Below is the key information for UTI Gilt Fund

UTI Gilt Fund
Growth
Launch Date 21 Jan 02
NAV (29 Sep 26) ₹65.5033 ↑ 0.16   (0.25 %)
Net Assets (Cr) ₹420 on 31 Aug 26
Category Debt - Government Bond
AMC UTI Asset Management Company Ltd
Rating ☆☆☆☆
Risk Moderate
Expense Ratio 0.92
Sharpe Ratio 0.26
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 6.15%
Effective Maturity 6 Years 10 Months 20 Days
Modified Duration 3 Years

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹10,179
31 Aug 23₹10,845
31 Aug 24₹11,785
31 Aug 25₹12,305
31 Aug 26₹13,078

UTI 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 ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for UTI 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 29 Sep 26

DurationReturns
1 Month -0.4%
3 Month -0.3%
6 Month 2.6%
1 Year 4.4%
3 Year 6.2%
5 Year 5.3%
10 Year
15 Year
Since launch 7.9%
Historical performance (Yearly) on absolute basis
YearReturns
2024 5.1%
2023 8.9%
2022 6.7%
2021 2.9%
2020 2.3%
2019 10.3%
2018 11.8%
2017 6.3%
2016 4.3%
2015 15.5%
Fund Manager information for UTI Gilt Fund
NameSinceTenure
Pankaj Pathak8 Apr 251.4 Yr.

Data below for UTI Gilt Fund as on 31 Aug 26

Asset Allocation
Asset ClassValue
Cash9.07%
Debt90.93%
Debt Sector Allocation
SectorValue
Government90.93%
Cash Equivalent9.07%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.9% Govt Stock 2065
Sovereign Bonds | -
44%₹184 Cr2,050,000,000
↓ -50,000,000
6.79% Govt Stock 2027
Sovereign Bonds | -
18%₹75 Cr750,000,000
↓ -250,000,000
7.71% Govt Stock 2066
Sovereign Bonds | -
12%₹50 Cr500,000,000
↑ 500,000,000
7.24% Govt Stock 2055
Sovereign Bonds | -
9%₹38 Cr400,000,000
7.18% Tamilnadu SDL 2027
Sovereign Bonds | -
4%₹15 Cr150,000,000
7.3% Uttarakhand Sgs 2032
Sovereign Bonds | -
2%₹8 Cr85,730,000
7.77% Andhra Sdl 2028
Sovereign Bonds | -
1%₹5 Cr50,000,000
Day Tbill
Sovereign Bonds | -
0%₹2 Cr16,050,000
↓ -300,000,000
Net Current Assets
Net Current Assets | -
9%₹36 Cr
Clearing Corporation Of India Ltd. Std - Margin
CBLO/Reverse Repo | -
0%₹2 Cr00

3. Franklin India Government Securities Fund

(Erstwhile Franklin India Government Securities Fund - Long Term Plan)

Aims to invest exclusively in government securities of Zero credit or default risk

Research Highlights for Franklin India Government Securities Fund

  • Bottom quartile AUM (₹148 Cr).
  • Established history (24+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderate.
  • 1Y return: 4.40% (lower mid).
  • 1M return: -0.33% (upper mid).
  • Sharpe: 0.36 (upper mid).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 7.11% (lower mid).
  • Modified duration: 3.71 yrs (upper mid).
  • Average maturity: 10.39 yrs (upper mid).
  • Exit load: NIL.
  • Higher exposure to Government (bond sector) vs peer median.
  • Debt-heavy allocation (~67%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding Maharashtra SDL (~20.1%).
  • Top-3 holdings concentration ~41.2%.

Below is the key information for Franklin India Government Securities Fund

Franklin India Government Securities Fund
Growth
Launch Date 7 Dec 01
NAV (29 Sep 26) ₹61.3537 ↑ 0.05   (0.08 %)
Net Assets (Cr) ₹148 on 15 Aug 26
Category Debt - Government Bond
AMC Franklin Templeton Asst Mgmt(IND)Pvt Ltd
Rating ☆☆☆
Risk Moderate
Expense Ratio 1.14
Sharpe Ratio 0.36
Information Ratio 0
Alpha Ratio 0
Min Investment 10,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 7.11%
Effective Maturity 10 Years 4 Months 20 Days
Modified Duration 3 Years 8 Months 16 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹10,226
31 Aug 23₹10,701
31 Aug 24₹11,441
31 Aug 25₹11,941
31 Aug 26₹12,766

Franklin India Government Securities 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 Franklin India Government Securities Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 29 Sep 26

DurationReturns
1 Month -0.3%
3 Month 0.6%
6 Month 3.6%
1 Year 4.4%
3 Year 5.8%
5 Year 4.8%
10 Year
15 Year
Since launch 7.6%
Historical performance (Yearly) on absolute basis
YearReturns
2024 5.5%
2023 7.3%
2022 5.5%
2021 2.5%
2020 2.1%
2019 8.5%
2018 8%
2017 4.3%
2016 0.1%
2015 15.7%
Fund Manager information for Franklin India Government Securities Fund
NameSinceTenure
Rahul Goswami6 Oct 232.9 Yr.
Anuj Tagra7 Mar 242.48 Yr.

Data below for Franklin India Government Securities Fund as on 15 Aug 26

Asset Allocation
Asset ClassValue
Cash33.41%
Debt66.59%
Debt Sector Allocation
SectorValue
Government87.04%
Cash Equivalent12.96%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Maharashtra SDL
Sovereign Bonds | -
20%₹29 Cr3,000,000
↑ 3,000,000
7.73% Andhra Sgs 2032
Sovereign Bonds | -
11%₹16 Cr1,500,000
7.62% Punjab Sgs 2033
Sovereign Bonds | -
10%₹15 Cr1,500,000
India (Republic of)
- | -
10%₹15 Cr1,500,000
India (Republic of)
- | -
10%₹15 Cr1,500,000
↑ 1,500,000
7.86% Haryana Sdl 2032
Sovereign Bonds | -
7%₹10 Cr1,000,000
Punjab (State Of) 7.02%
- | -
5%₹8 Cr800,000
↓ -1,200,000
Kerala (Government of) 7.56%
- | -
3%₹5 Cr510,200
7.17% Rajasthan Sdl 2032
Sovereign Bonds | -
3%₹5 Cr500,000
Bihar State Development Loans
Sovereign Bonds | -
2%₹3 Cr312,440

4. Axis Gilt Fund

(Erstwhile Axis Constant Maturity 10 Year Fund)

To generate returns similar to that of 10 year government bonds.

Research Highlights for Axis Gilt Fund

  • Lower mid AUM (₹341 Cr).
  • Established history (14+ yrs).
  • Rating: 1★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 3.57% (bottom quartile).
  • 1M return: -0.61% (bottom quartile).
  • Sharpe: 0.01 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 7.25% (upper mid).
  • Modified duration: 8.98 yrs (lower mid).
  • Average maturity: 22.64 yrs (lower mid).
  • Exit load: NIL.
  • Top bond sector: Government.
  • Conservative stance with elevated cash (~40%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding India (Republic of) (~18.6%).
  • Top-3 holdings concentration ~40.0%.

Below is the key information for Axis Gilt Fund

Axis Gilt Fund
Growth
Launch Date 23 Jan 12
NAV (29 Sep 26) ₹26.5178 ↑ 0.04   (0.17 %)
Net Assets (Cr) ₹341 on 31 Aug 26
Category Debt - Government Bond
AMC Axis Asset Management Company Limited
Rating ☆
Risk Moderate
Expense Ratio 0.82
Sharpe Ratio 0.01
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load NIL
Yield to Maturity 7.25%
Effective Maturity 22 Years 7 Months 20 Days
Modified Duration 8 Years 11 Months 23 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹10,232
31 Aug 23₹10,797
31 Aug 24₹11,873
31 Aug 25₹12,484
31 Aug 26₹13,174

Axis 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 ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for Axis 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 29 Sep 26

DurationReturns
1 Month -0.6%
3 Month -1%
6 Month 3.4%
1 Year 3.6%
3 Year 6.7%
5 Year 5.4%
10 Year
15 Year
Since launch 6.9%
Historical performance (Yearly) on absolute basis
YearReturns
2024 5.2%
2023 10%
2022 7.1%
2021 2.4%
2020 2.4%
2019 13.1%
2018 12%
2017 5.3%
2016 1.4%
2015 13.7%
Fund Manager information for Axis Gilt Fund
NameSinceTenure
Devang Shah5 Nov 1213.83 Yr.
Sachin Jain1 Feb 233.58 Yr.

Data below for Axis Gilt Fund as on 31 Aug 26

Asset Allocation
Asset ClassValue
Cash40.14%
Debt59.86%
Debt Sector Allocation
SectorValue
Government67.2%
Cash Equivalent32.8%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
India (Republic of)
- | -
19%₹63 Cr6,500,000
↑ 6,500,000
7.24% Govt Stock 2055
Sovereign Bonds | -
14%₹48 Cr5,000,000
↓ -1,000,000
India (Republic of)
- | -
7%₹25 Cr2,500,000
↑ 2,500,000
Tbill
Sovereign Bonds | -
7%₹25 Cr2,500,000
↑ 2,500,000
91 Days Tbill (Md 10/12/2026)
Sovereign Bonds | -
7%₹25 Cr2,500,000
↑ 2,500,000
7.09% Govt Stock 2054
Sovereign Bonds | -
7%₹23 Cr2,500,000
7.63% Government Of India (15/09/2056)
Sovereign Bonds | -
3%₹12 Cr1,177,600
↑ 1,177,600
7.71% Govt Stock 2066
Sovereign Bonds | -
3%₹10 Cr1,000,000
↓ -1,000,000
Tbill
Sovereign Bonds | -
3%₹10 Cr1,000,000
7.34% Govt Stock 2064
Sovereign Bonds | -
3%₹9 Cr994,700

All the funds mentioned above are ideal, we are giving you detailed analysis of 2 funds.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Bandhan Government Securities Fund - Constant Maturity Plan Growth ₹47.9053
↑ 0.09
₹294-0.82.947.27.56.95%6Y 10M 10D10Y 25D
ICICI Prudential Constant Maturity Gilt Fund Growth ₹25.7609
↑ 0.05
₹2,012-0.92.53.66.97.57.06%6Y 10M 13D10Y 1M 13D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Sep 26

Research Highlights & Commentary of 2 Funds showcased

CommentaryBandhan Government Securities Fund - Constant Maturity PlanICICI Prudential Constant Maturity Gilt Fund
Point 1Bottom quartile AUM (₹294 Cr).Highest AUM (₹2,012 Cr).
Point 2Oldest track record among peers (24 yrs).Established history (12+ yrs).
Point 3Top rated.Rating: 3★ (bottom quartile).
Point 4Risk profile: Moderate.Risk profile: Moderate.
Point 51Y return: 3.96% (upper mid).1Y return: 3.56% (bottom quartile).
Point 61M return: -1.16% (bottom quartile).1M return: -1.12% (upper mid).
Point 7Sharpe: 0.16 (upper mid).Sharpe: 0.01 (bottom quartile).
Point 8Information ratio: 0.00 (upper mid).Information ratio: 0.00 (bottom quartile).
Point 9Yield to maturity (debt): 6.95% (bottom quartile).Yield to maturity (debt): 7.06% (upper mid).
Point 10Modified duration: 6.86 yrs (upper mid).Modified duration: 6.87 yrs (bottom quartile).

Bandhan Government Securities Fund - Constant Maturity Plan

  • Bottom quartile AUM (₹294 Cr).
  • Oldest track record among peers (24 yrs).
  • Top rated.
  • Risk profile: Moderate.
  • 1Y return: 3.96% (upper mid).
  • 1M return: -1.16% (bottom quartile).
  • Sharpe: 0.16 (upper mid).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 6.95% (bottom quartile).
  • Modified duration: 6.86 yrs (upper mid).

ICICI Prudential Constant Maturity Gilt Fund

  • Highest AUM (₹2,012 Cr).
  • Established history (12+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 3.56% (bottom quartile).
  • 1M return: -1.12% (upper mid).
  • Sharpe: 0.01 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 7.06% (upper mid).
  • Modified duration: 6.87 yrs (bottom quartile).

1. Bandhan 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.

Research Highlights for Bandhan Government Securities Fund - Constant Maturity Plan

  • Lower mid AUM (₹294 Cr).
  • Established history (24+ yrs).
  • Rating: 3★ (upper mid).
  • Risk profile: Moderate.
  • 1Y return: 3.96% (top quartile).
  • 1M return: -1.16% (bottom quartile).
  • Sharpe: 0.16 (top quartile).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 6.95% (lower mid).
  • Modified duration: 6.86 yrs (lower mid).
  • Average maturity: 10.07 yrs (lower mid).
  • Exit load: NIL.
  • Top bond sector: Government.
  • Debt-heavy allocation (~95%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding 6.94% Govt Stock 2036 (~67.1%).
  • Top-3 holdings concentration ~93.1%.

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

Bandhan Government Securities Fund - Constant Maturity Plan
Growth
Launch Date 9 Mar 02
NAV (29 Sep 26) ₹47.9053 ↑ 0.09   (0.18 %)
Net Assets (Cr) ₹294 on 15 Aug 26
Category Debt - 10 Yr Govt Bond
AMC IDFC Asset Management Company Limited
Rating ☆☆☆
Risk Moderate
Expense Ratio 0.43
Sharpe Ratio 0.16
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load NIL
Yield to Maturity 6.95%
Effective Maturity 10 Years 25 Days
Modified Duration 6 Years 10 Months 10 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹9,990
31 Aug 23₹10,648
31 Aug 24₹11,622
31 Aug 25₹12,484
31 Aug 26₹13,253

Bandhan 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 ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for Bandhan 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 29 Sep 26

DurationReturns
1 Month -1.2%
3 Month -0.8%
6 Month 2.9%
1 Year 4%
3 Year 7.2%
5 Year 5.5%
10 Year
15 Year
Since launch 6.6%
Historical performance (Yearly) on absolute basis
YearReturns
2024 7.5%
2023 9.7%
2022 7.4%
2021 0.7%
2020 1.8%
2019 13.2%
2018 14.2%
2017 11.8%
2016 6.2%
2015 10.1%
Fund Manager information for Bandhan Government Securities Fund - Constant Maturity Plan
NameSinceTenure
Harshal Joshi15 May 179.3 Yr.
Brijesh Shah10 Jun 242.23 Yr.

Data below for Bandhan Government Securities Fund - Constant Maturity Plan as on 15 Aug 26

Asset Allocation
Asset ClassValue
Cash4.64%
Debt95.36%
Debt Sector Allocation
SectorValue
Government95.36%
Cash Equivalent4.64%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.94% Govt Stock 2036
Sovereign Bonds | -
67%₹193 Cr19,500,000
6.68% Govt Stock 2040
Sovereign Bonds | -
20%₹57 Cr6,000,000
Karnataka State Development Loans
Sovereign Bonds | -
6%₹18 Cr1,800,000
7.1% Govt Stock 2034
Sovereign Bonds | -
2%₹5 Cr500,000
7.18% Govt Stock 2033
Sovereign Bonds | -
0%₹1 Cr100,000
8.24% Govt Stock 2027
Sovereign Bonds | -
0%₹0 Cr44,000
Triparty Repo Trp_160926
CBLO/Reverse Repo | -
3%₹8 Cr
Net Current Assets
Net Current Assets | -
2%₹6 Cr
Cash Margin - Ccil
CBLO/Reverse Repo | -
0%₹0 Cr

2. 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.

Research Highlights for ICICI Prudential Constant Maturity Gilt Fund

  • Highest AUM (₹2,012 Cr).
  • Established history (12+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderate.
  • 1Y return: 3.56% (upper mid).
  • 1M return: -1.12% (upper mid).
  • Sharpe: 0.01 (upper mid).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 7.06% (top quartile).
  • Modified duration: 6.87 yrs (bottom quartile).
  • Average maturity: 10.12 yrs (bottom quartile).
  • Exit load: 0-7 Days (0.25%),7 Days and above(NIL).
  • Top bond sector: Government.
  • Debt-heavy allocation (~97%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding 6.94% Govt Stock 2036 (~73.9%).
  • Top-3 holdings concentration ~88.1%.

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 (29 Sep 26) ₹25.7609 ↑ 0.05   (0.18 %)
Net Assets (Cr) ₹2,012 on 31 Aug 26
Category Debt - 10 Yr Govt Bond
AMC ICICI Prudential Asset Management Company Limited
Rating ☆☆☆
Risk Moderate
Expense Ratio 0.39
Sharpe Ratio 0.01
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 7.06%
Effective Maturity 10 Years 1 Month 13 Days
Modified Duration 6 Years 10 Months 13 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹10,078
31 Aug 23₹10,769
31 Aug 24₹11,686
31 Aug 25₹12,599
31 Aug 26₹13,298

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 ₹197,169.
Net Profit of ₹17,169
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 29 Sep 26

DurationReturns
1 Month -1.1%
3 Month -0.9%
6 Month 2.5%
1 Year 3.6%
3 Year 6.9%
5 Year 5.5%
10 Year
15 Year
Since launch 8.2%
Historical performance (Yearly) on absolute basis
YearReturns
2024 7.5%
2023 9.3%
2022 7.7%
2021 1.2%
2020 2.8%
2019 13.6%
2018 12.8%
2017 9.7%
2016 2.4%
2015 16.2%
Fund Manager information for ICICI Prudential Constant Maturity Gilt Fund
NameSinceTenure
Manish Banthia22 Jan 242.61 Yr.
Raunak Surana22 Jan 242.61 Yr.

Data below for ICICI Prudential Constant Maturity Gilt Fund as on 31 Aug 26

Asset Allocation
Asset ClassValue
Cash2.91%
Debt97.09%
Debt Sector Allocation
SectorValue
Government97.09%
Cash Equivalent2.91%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.94% Govt Stock 2036
Sovereign Bonds | -
74%₹1,463 Cr147,724,070
↑ 17,500,000
7.06% Govt Stock 2041
Sovereign Bonds | -
8%₹163 Cr16,500,000
↓ -10,000,000
6.68% Govt Stock 2040
Sovereign Bonds | -
6%₹119 Cr12,492,500
State Government Of Karnataka
Sovereign Bonds | -
4%₹73 Cr7,500,000
7.18% Uttarpradesh Sgs 2035
Sovereign Bonds | -
3%₹53 Cr5,500,000
7.74% Karnataka Sgs 2036
Sovereign Bonds | -
3%₹50 Cr5,000,000
7.18% Govt Stock 2037
Sovereign Bonds | -
0%₹2 Cr200,000
Treps
CBLO/Reverse Repo | -
2%₹32 Cr
Net Current Assets
Net Current Assets | -
1%₹25 Cr
6.64% Govt Stock 2035
Sovereign Bonds | -
₹0 Cr00
↓ -1,000,000

3. 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.

Research Highlights for SBI Magnum Constant Maturity Fund

  • Upper mid AUM (₹1,605 Cr).
  • Oldest track record among peers (25 yrs).
  • Top rated.
  • Risk profile: Moderately Low.
  • 1Y return: 2.73% (lower mid).
  • 1M return: -1.14% (lower mid).
  • Sharpe: -0.23 (lower mid).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 6.97% (upper mid).
  • Modified duration: 6.83 yrs (top quartile).
  • Average maturity: 9.61 yrs (upper mid).
  • Exit load: NIL.
  • Top bond sector: Government.
  • Debt-heavy allocation (~97%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding 6.94% Govt Stock 2036 (~66.8%).
  • Top-3 holdings concentration ~91.1%.

Below is the key information for SBI Magnum Constant Maturity Fund

SBI Magnum Constant Maturity Fund
Growth
Launch Date 30 Dec 00
NAV (29 Sep 26) ₹65.7966 ↑ 0.12   (0.18 %)
Net Assets (Cr) ₹1,605 on 31 Aug 26
Category Debt - 10 Yr Govt Bond
AMC SBI Funds Management Private Limited
Rating ☆☆☆☆
Risk Moderately Low
Expense Ratio 0.63
Sharpe Ratio -0.23
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 500
Exit Load NIL
Yield to Maturity 6.97%
Effective Maturity 9 Years 7 Months 10 Days
Modified Duration 6 Years 9 Months 29 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹10,116
31 Aug 23₹10,783
31 Aug 24₹11,708
31 Aug 25₹12,529
31 Aug 26₹13,118

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 ₹197,169.
Net Profit of ₹17,169
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 29 Sep 26

DurationReturns
1 Month -1.1%
3 Month -1%
6 Month 2.1%
1 Year 2.7%
3 Year 6.4%
5 Year 5.2%
10 Year
15 Year
Since launch 7.6%
Historical performance (Yearly) on absolute basis
YearReturns
2024 6.7%
2023 9.1%
2022 7.5%
2021 1.3%
2020 2.4%
2019 11.6%
2018 11.9%
2017 9.9%
2016 6.2%
2015 12.8%
Fund Manager information for SBI Magnum Constant Maturity Fund
NameSinceTenure
Sudhir Agarwal1 Jul 251.17 Yr.

Data below for SBI Magnum Constant Maturity Fund as on 31 Aug 26

Asset Allocation
Asset ClassValue
Cash2.7%
Debt97.3%
Debt Sector Allocation
SectorValue
Government97.3%
Cash Equivalent2.7%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.94% Govt Stock 2036
Sovereign Bonds | -
67%₹1,060 Cr107,000,000
↑ 25,000,000
7.18% Govt Stock 2037
Sovereign Bonds | -
15%₹241 Cr23,999,500
6.48% Govt Stock 2035
Sovereign Bonds | -
9%₹144 Cr15,000,000
↓ -26,000,000
6.79% Govt Stock 2034
Sovereign Bonds | -
6%₹98 Cr10,000,000
↓ -500,000
Net Receivable / Payable
CBLO | -
3%₹40 Cr
Treps
CBLO/Reverse Repo | -
0%₹2 Cr

4. DSP 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.

Research Highlights for DSP 10Y G-Sec Fund

  • Bottom quartile AUM (₹44 Cr).
  • Established history (12+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 1.61% (bottom quartile).
  • 1M return: -1.10% (top quartile).
  • Sharpe: -0.68 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 6.78% (bottom quartile).
  • Modified duration: 6.84 yrs (upper mid).
  • Average maturity: 8.91 yrs (top quartile).
  • Exit load: 0-7 Days (0.1%),7 Days and above(NIL).
  • Top bond sector: Government.
  • Debt-heavy allocation (~98%).
  • High-quality debt (AAA/AA ~100%).
  • Largest holding 6.94% Govt Stock 2036 (~94.8%).
  • Top-3 holdings concentration ~99.7%.

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

DSP 10Y G-Sec Fund
Growth
Launch Date 26 Sep 14
NAV (29 Sep 26) ₹22.235 ↑ 0.04   (0.19 %)
Net Assets (Cr) ₹44 on 15 Aug 26
Category Debt - 10 Yr Govt Bond
AMC DSP BlackRock Invmt Managers Pvt. Ltd.
Rating ☆☆☆
Risk Moderate
Expense Ratio 0.51
Sharpe Ratio -0.68
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 6.78%
Effective Maturity 8 Years 10 Months 28 Days
Modified Duration 6 Years 10 Months 2 Days

Growth of 10,000 investment over the years.

DateValue
31 Aug 21₹10,000
31 Aug 22₹9,926
31 Aug 23₹10,605
31 Aug 24₹11,492
31 Aug 25₹12,306
31 Aug 26₹12,705

DSP 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 ₹194,235.
Net Profit of ₹14,235
Invest Now

Returns for DSP 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 29 Sep 26

DurationReturns
1 Month -1.1%
3 Month -1.1%
6 Month 1.5%
1 Year 1.6%
3 Year 5.9%
5 Year 4.6%
10 Year
15 Year
Since launch 6.9%
Historical performance (Yearly) on absolute basis
YearReturns
2024 6.2%
2023 9%
2022 7.7%
2021 0.1%
2020 0.7%
2019 11.8%
2018 10.8%
2017 5.9%
2016 2.3%
2015 15.5%
Fund Manager information for DSP 10Y G-Sec Fund
NameSinceTenure
Shantanu Godambe1 Jul 233.17 Yr.

Data below for DSP 10Y G-Sec Fund as on 15 Aug 26

Asset Allocation
Asset ClassValue
Cash1.85%
Debt98.15%
Debt Sector Allocation
SectorValue
Government98.15%
Cash Equivalent1.85%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.94% Govt Stock 2036
Sovereign Bonds | -
95%₹36 Cr3,500,000
↓ -561,000
6.48% Govt Stock 2035
Sovereign Bonds | -
3%₹1 Cr125,000
Net Receivables/Payables
Net Current Assets | -
2%₹1 Cr
Treps / Reverse Repo Investments
CBLO/Reverse Repo | -
0%₹0 Cr

Returns and Risks of Gilt Funds

When it comes to safety, Government Securities (G-Secs) are unmatched. They are the most liquid and trusted instruments in India’s debt market — because the borrower is the Government of India itself. That means no credit risk. Unlike corporate Bonds that can default if a company runs into financial trouble, the government almost never defaults on its obligations.

This is precisely why G-Secs are “sovereign-rated”, which is considered even more reliable than a corporate AAA rating — the highest grade given to private institutions.

Understanding the Risk

Does that mean Gilt Funds carry no risk? Not quite.

While they are free from credit risk, they do carry interest rate risk — and that’s the factor investors often overlook.

Here’s why:

Gilt funds primarily invest in long-term government securities, often with maturities ranging from 5 years to even 30 years.

The longer the maturity, the more sensitive the bond’s price is to changes in interest rates. When interest rates fall, the prices of existing bonds (with higher coupon rates) rise, giving higher returns. But when interest rates rise, bond prices drop — leading to potential short-term losses. Because of this, Gilt Funds can be volatile in the short term. Their average maturity is usually much higher than that of typical bond funds or corporate debt funds, which makes their Net Asset Value (NAV) move sharply with every rate change.

In fact, one of the easiest ways for a bond fund manager to increase the maturity profile of their Portfolio is by buying more G-Secs. That’s why Gilt Funds are usually more volatile than other categories of debt funds. However, if you stay invested for the long term, these fluctuations tend to even out — and investors benefit from both capital appreciation (when rates fall) and regular coupon income.

📈 Returns Through the Years

Historically, Gilt Funds have shown a wide range of returns depending on interest rate cycles -

  • Over a 3-year period, returns have ranged from near 0% during rate hike phases to as high as 15–16% during falling rate cycles.

  • Over a 5-year horizon, the returns have typically ranged between 1% and 13%, based on data compiled by rating agencies like CRISIL.

This means — while Gilt Funds can experience short-term Volatility, they can also deliver powerful gains during periods of declining interest rates.

For investors who stay patient and understand the rate cycle, Gilt Funds can be an excellent low-risk yet rewarding part of a diversified portfolio.

How to Invest in Govt Bond 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

FAQs

1. What are government securities?

A: Government securities, or G-Secs, are debt instruments issued by the Government of India to borrow funds from the public. These are considered one of the safest investment options, as they carry sovereign backing. The Reserve Bank of India (RBI) manages the issuance and trading of these securities on behalf of the government.

2. Who can invest in government bonds?

A: Earlier, G-Secs were accessible mainly to institutional investors such as banks and Insurance companies. Today, even individual investors can invest directly through the RBI Retail Direct platform or indirectly via Government Bond Mutual Funds (Gilt Funds) offered by AMCs like Edelweiss, Axis, or ICICI Prudential.

3. Are government bonds taxable?

A: Yes. The interest income from Government Bonds is fully taxable as per your income tax slab. Additionally, if you sell your bonds before maturity, capital gains tax may apply depending on your holding period.

4. Are there any tax-free government bonds?

A: Yes, some Tax-Free Bonds are issued by public sector companies like REC, NHAI, or HUDCO. The interest earned on these bonds is exempt from tax, though their yields are usually lower than taxable bonds.

5. Is tax-free bonds taxable?

A: The interest income is tax-free, but if you sell the bonds before maturity, the capital gains can be taxable. Long-term capital gains (held for more than one year) are taxed at 10% without indexation.

6. Is there any risk involved in the government bonds?

A: Government Bonds carry negligible default risk due to sovereign backing, but they are not entirely risk-free. They are sensitive to interest rate movements, meaning their prices can fluctuate in the short term. Over the long run, however, they remain one of the most stable investment options.

7. How do I evaluate government bonds?

A: To evaluate, focus on -

  • Yield to Maturity (YTM) - Indicates potential return if held till maturity.
  • Duration/Maturity - Longer maturity means higher sensitivity to interest rate changes.
  • Historical Performance & Expense Ratio - For gilt mutual funds, compare these metrics instead of NAV alone.

8. What is the most significant benefit of investing in government bonds?

A: Sovereign Safety: Backed by the Government of India.

  • Stable Returns - Suitable for conservative investors.

  • Diversification - Balances equity-heavy portfolios.

  • Predictability - Fixed coupon payments and low credit risk.

    Government Bonds and Gilt Funds are ideal for investors seeking safety, steady income, and portfolio stability over long periods.

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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