Over 100 debt mutual funds deliver returns higher than fixed deposit schemes. See top 5 (2024)

Looking to invest in debt mutual funds which have delivered higher returns than your fixed deposit schemes? Well there are at least 116 such plans with superior income on investments but we have picked the top five for you.

In debt MFs, returns up to 1 year are simple annualised as against equity mutual funds where returns up to one year are absolute.

While interest rates on fixed deposits vary from bank to bank, a standard annualized rate of 8% per annum has been taken as the benchmark. Five debt MFs which have given higher returns are:

1) DSP Credit Risk Direct Plan(G)

The DSP Credit Risk Direct Plan(G) has given an annualised 1-year returns of 17.18%. This fund is a mix of high yielding and lower-rated debt securities and it invests in debt instruments across different credit ratings, with at least 65% in AA and below rated securities. The total Assets Under Management (AUM) stood at Rs 205.15 crore as on January 31, 2024 while the net asset value (NAV) as on February 27 stood at Rs 42.56%.

2) Invesco India Credit Risk Fund(G)-Direct Plan

The 1-year annualised returns delivered by Invesco India Credit Risk Fund(G)-Direct Plan stands at 13.60%. The average AUM at the December ended quarter stood at Rs 139 crore with NAV reported at Rs 1878.44 as on February 27. The fund invests in corporate debt securities of varying maturities across the credit spectrum and its investments are in corporate bonds rated 'AA' or below.

3) DSP Strategic Bond Fund(G)-Direct Plan

The 1-year annualised returns given by DSP Strategic Bond Fund(G)-Direct Plan stand at 11.32%. This fund invests in high-quality government and corporate debt securities with 100% investments in AAA or higher rated instruments. One of DSP's oldest debt funds with a 14 year+ track record, it is a highly liquid portfolio with actively managed portfolio duration based on future interest rate movement predictions.

The AUM as on January 31, 2024 stood at Rs 911.74 crores while the NAV as on February 27, 2024 was Rs 3,039.78.

SBI Long Duration Fund(G)-Direct Plan

The 1-year annualised returns given by SBI Long Duration Fund(G)-Direct Plan stand at 11.15%. The NAV as of February 27, 2024 is Rs 11.25 for Growth option of its Direct plan while the AUM as on January 31, 2024 stood at Rs 1227.31 crore. It is an open-ended debt scheme investing in instruments such that the Macaulay duration of the portfolio is greater than 7 Years.

HDFC Long Duration Debt Fund(G)-Direct Plan

The 1-year annualised returns given by HDFC Long Duration Debt Fund(G)-Direct Plan stand at 10.86%. This is also an open ended debt scheme investing in instruments such that the Macaulay Duration of the portfolio is greater than 7 years. The scheme was launched in January 2023. The AUM as on January 31, 2024 stood at Rs 1,738.27 crore while the NAV at Rs 11.11.

Also Read: Rs 6 lakh investment doubles in 5 years with this large & midcap mutual fund scheme. Check details

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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