Debt Mutual Funds invest in fixed income or fixed income generating securities such as government securities, corporate bonds, commercial papers, treasury bills (T-Bills), etc. The aim of debt mutual fund schemes is to deliver stable and low-risk returns that are usually better than fixed deposits.
Debt Mutual Fund schemes are sometimes also called “Fixed-income securities” as the investor already knows what they’re gonna get out of investing in them. This happens because the issuer pre-decides the interest rate as well as the maturity period. The returns are less and is generally suited to the more risk-averse investors.
In the light of this, let’s have a look at the 10 Best Debt Mutual Funds to invest in 2019,
Table of Content
- 1 #1 Debt Mutual Funds: SBI Magnum Income Fund – Direct – Growth
- 2 #2 Debt Mutual Funds: Aditya Birla Sun Life Savings Fund – Direct – Growth
- 3 #3 Debt Mutual Funds: ICICI Prudential Bond Fund – Direct – Growth
- 4 #4 Debt Mutual Funds: Franklin India Dynamic Accrual Fund – Direct – Growth
- 5 #5 Debt Mutual Funds: Reliance Gilt Securities Fund – Direct – Growth
- 6 #6 Debt Mutual Funds: Axis Dynamic Bond Fund – Direct – Growth
- 7 #7 Debt Mutual Funds: UTI Bond Fund – Direct – Growth
- 8 #8 Debt Mutual Funds: Kotak Bond Fund – Direct – Growth
- 9 #9 Debt Mutual Funds: HDFC Short Term Debt Fund – Direct – Growth
- 10 #10 Debt Mutual Funds: L&T Short Term Bond Fund – Direct – Growth
#1 Debt Mutual Funds: SBI Magnum Income Fund – Direct – Growth
SBI Magnum Income Fund was launched in 2013. The fund is open ended and offers moderate risk. The Fund has 96.15% investment in Debt out of which 3.04% is in Government securities and the rest 93.11% is in funds invested in very low risk securities.
The Fund is managed by Mr. Dinesh Ahuja and has a minimum SIP amount of Rs 500, with the Expense Ratio being 1.47%.
| Fund name | 1 year | 3 year | 5 year |
| SBI Magnum Income Fund | 9.22% | 7.88% | 8.53% |
#2 Debt Mutual Funds: Aditya Birla Sun Life Savings Fund – Direct – Growth
Aditya Birla Sun Life Savings Fund was launched way back in November 2001. The fund is open ended and offers moderately low risk. The fund’s objective is primarily to generate regular income through investments in both the debt and the money market instruments.
The fund is managed by the duo of Sunaina Da Cunha and Kaustubh Gupta and has a minimum SIP amount of Rs 1000, with the Expense Ratio being 0.35%.
| Fund name | 1 year | 3 year | 5 year |
| Aditya Birla Sun Life Savings Fund | 8.56% | 7.34% | 8.39% |
#3 Debt Mutual Funds: ICICI Prudential Bond Fund – Direct – Growth
ICICI Prudential Bond Fund was launched in 2008. The fund is meant for those Investors who want to invest money for a longer duration and prefer low risk assets as compared to equity funds. The fund is open ended which means you can invest any time you want in the fund.
The fund is managed by Manish Banthia and has no minimum SIP amount but does come with Expense Ratio of 0.55%.
| Fund name | 1 year | 3 year | 5 year |
| ICICI Prudential Bond Fund | 9.14% | 7.39% | 8.43% |
#4 Debt Mutual Funds: Franklin India Dynamic Accrual Fund – Direct – Growth
Franklin India Dynamic Accrual Fund was launched in 1997. This fund has 94.59% of its investment in debt out of which 43.15% is invested in funds with very low risk securities. The fund has given better results than the set benchmarks during long term periods as well as short term periods.
The fund is managed by Santosh Kamath, Sachin Padwal-Desai and Umesh Sharma and has no minimum SIP amount but does come with Expense Ratio of 0.87%.
| Fund name | 1 year | 3 year | 5 year |
| Franklin India Dynamic Accrual Fund | 9.11% | 8.83% | 9.37% |
#5 Debt Mutual Funds: Reliance Gilt Securities Fund – Direct – Growth
Reliance Gilt Securities fund was launched in September 2008. The fund is specially meant for those Investors who want to invest long term but their priority is the safety of their investments. Considering the fund has all its assets in government securities, it’s completely credit-risk free.
The fund is managed by Prashant Pimple and has a minimum SIP amount of Rs 100, with the Expense Ratio being 1.59%.
| Fund name | 1 year | 3 year | 5 year |
| Reliance Gilt Securities Fund | 14.38% | 9.84% | 10.57% |
#6 Debt Mutual Funds: Axis Dynamic Bond Fund – Direct – Growth
Axis dynamic bond fund was launched in April 2011. The fund has given excellent results to its investors. It has given better results than its set benchmarks during the first year and the third year. With the average age of Maturity at set at 6.80 years, it’s one of the best options available for investment in the market.
The fund is managed by the duo of R. Sivakumar & Devang Shah and has a minimum SIP amount of Rs 1000, with the Expense Ratio being 1.41%.
| Fund name | 1 year | 3 year | 5 year |
| Axis dynamic Bond Fund | 11.90% | 8.80% | 9.84% |
#7 Debt Mutual Funds: UTI Bond Fund – Direct – Growth
UTI Bond Fund was launched in May 1998. The fund is open ended and offers the investor a moderate amount of risk. The Fund has 95.72% investment in Debt out of which 3.96% is in Government securities and 79.76% is invested in funds which offer very low risk securities.
The fund is managed by Amandeep S. Chopra and has a minimum SIP amount of Rs 500, with the Expense Ratio being 1.72%.
| Fund name | 1 year | 3 year | 5 year |
| UTI Bond Fund | -4.34% | 3.25% | 5.63% |
#8 Debt Mutual Funds: Kotak Bond Fund – Direct – Growth
Kotak Bond Fund is meant for investors who want to spend money for longer duration and prefer less riskier assets as compared to equity funds. The fund was launched in 1999 and offers moderate risk. This fund has 101.87% investment in Debt out of which 38.63% is in Government securities and 63.24% is invested in funds that offer very low risk securities.
The fund is managed by Abhishek Bisen and has a minimum SIP amount of Rs 1000, with the Expense Ratio being 1.83%.
| Fund name | 1 year | 3 year | 5 year |
| Kotak Bond Fund | 10.41% | 6.68% | 7.81% |
#9 Debt Mutual Funds: HDFC Short Term Debt Fund – Direct – Growth
HDFC Short Term Debt Fund is meant for investors who want to spend money for 1 to 3 years and don’t want to invest in Bank Deposits. The fund was launched in June 2010 and offers moderately low risk. This fund has 89.24% investment in Debt out of which 1.15% is in Government securities and 87.86% is invested in funds that offer very low risk securities.
The fund is managed by Anil Bamboli and has a minimum SIP amount of Rs 500, with the Expense Ratio being 0.4%.
| Fund name | 1 year | 3 year | 5 year |
| HDFC Short Term Debt Fund | 8.88% | 7.79% | 8.40% |
#10 Debt Mutual Funds: L&T Short Term Bond Fund – Direct – Growth
This fund was launched in December 2011 and offers moderately low risk. Along with that this Fund has 95.58% investment in Debt out of which 7.63% is in Government securities and 87.95% is invested in funds that offer very low risk securities. This scheme is open ended and is good for investors who are willing to invest for 3- 5 years and are looking for alternatives of investing in Bank deposits.
The fund is managed by the duo of Shriram Ramanathan and Jalpan Shah and has a minimum SIP amount of Rs 1000, with the Expense Ratio being 0.72%.
| Fund name | 1 year | 3 year | 5 year |
| L&T Short Term Bond Fund | 8.67% | 7.25% | 7.83% |
*the returns are as of 30th June, 2019
