Debt Fund SIP Giving Better Return: Talking about debt mutual funds, they fall in the category of fixed-income options. These are known to give stable returns like fixed deposits. However, in fixed deposits, returns are given as per the fixed interest. At the same time, there are fluctuations in the performance of debt funds. Debt funds carry some risk as compared to small savings schemes, but in the long run, they offer better returns than FDs. There is an expectation of reduction in interest rates in the coming days, due to which the returns of debt funds are also expected to improve.
SCSS: Deposit funds in this scheme after retirement, 20 thousand rupees will come home every month, couples can take double benefit.
Many of the investors who do not want to take direct equity risk but want better returns from FD are now turning to debt funds. Debt funds invest in securities that generate fixed income. For example, treasury bills, corporate bonds, commercial papers, government securities and many other money market instruments. Their returns are generally not affected by market fluctuations. In this, there is an option to invest for every period from 1 day to more than 7 years. Although they are known to give returns like FD, but there are some debt schemes which have given 10 to 24 percent annualized returns on 5 year SIP.
Bank of India Credit Risk Fund
Bank of India Credit Risk Fund has given 24.28 percent annualized return to those doing SIP and 10.85 percent annualized return to those doing lump sum in 5 years. The total assets of this fund till December 31, 2024 are Rs 114 crore. Whereas the expense ratio is 1.03 percent.
SIP performance of the fund
Annualized return of SIP in 5 years: 24.28%
Monthly SIP amount: Rs 10,000
Total investment in 5 years: Rs 6,00,000
Total value of SIP after 5 years: Rs 10,94,488
lump sum fund performance
Return in 5 years: 10.85% per annum
One Time Investment: Rs 1,00,000
Investment value after 5 years: Rs 1,67,370 (Rs 1.67 lakh)
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ABSL Medium Term Plan
ABSL Mid Term Plan has given 12.69 percent annualized return to those doing SIP and 12.04 percent annualized return to those doing lump sum in 5 years. The total assets of this fund till December 31, 2024 are Rs 2004 crore. Whereas the expense ratio is 0.85 percent.
SIP performance of the fund
Annualized return of SIP in 5 years: 12.69%
Monthly SIP amount: Rs 10,000
Total investment in 5 years: Rs 6,00,000
Total value of SIP after 5 years: Rs 8,24,998
lump sum fund performance
Return in 5 years: 12.04% per annum
One Time Investment: Rs 1,00,000
Investment value after 5 years: Rs 1,76,549 (Rs 1.77 lakh)
SIP in Top Scheme: 5 mutual funds with 7 times return in 10 years, money increased by 22 to 25% annually in SIP, all got top rating
Bank of India Short Term Income Fund
Bank of India Short Term Income Fund has given 10.86 percent annualized return to those doing SIP and 8.86 percent annualized return to those doing lump sum in 5 years. The total assets of this fund till December 31, 2024 are Rs 85 crore. Whereas the expense ratio is 0.45 percent.
SIP performance of the fund
Annualized return of SIP in 5 years: 10.86%
Monthly SIP amount: Rs 10,000
Total investment in 5 years: Rs 6,00,000
Total value of SIP after 5 years: Rs 7,88,361
lump sum fund performance
Return in 5 years: 8.86% per annum
One Time Investment: Rs 1,00,000
Investment value after 5 years: Rs 1,52,877 (Rs 1.57 lakh)
SIP King: SBI Mutual Fund’s scheme gave SIP returns of more than 20% per annum in 5, 10 and 15 years, lump sum investment increased by 18 times.
Baroda BNP Paribas Credit Risk Fund
Baroda BNP Paribas Credit Risk Fund has given 9.46 percent annualized return to those doing SIP and 9.03 percent annualized return to those doing lump sum in 5 years. The total assets of this fund till December 31, 2024 are Rs 169 crore. Whereas the expense ratio is 0.79 percent.
SIP performance of the fund
Annualized return of SIP in 5 years: 9.46%
Monthly SIP amount: Rs 10,000
Total investment in 5 years: Rs 6,00,000
Total value of SIP after 5 years: Rs 7,61,317
lump sum fund performance
Return in 5 years: 9% per annum
One Time Investment: Rs 1,00,000
Investment value after 5 years: Rs 1,54,074 (Rs 1.54 lakh)
SIP Winner: This mutual fund scheme became the champion for 20 years, 1 lakh was converted into 51 lakh, monthly SIP of Rs 5000 made a millionaire
UTI Dynamic Bond Fund
UTI Dynamic Bond Fund has given 9.35 percent annualized return to those doing SIP and 9.03 percent annualized return to those doing lump sum in 5 years. The total assets of this fund till December 31, 2024 are Rs 507 crore. Whereas the expense ratio is 0.67 percent.
SIP performance of the fund
Annualized return of SIP in 5 years: 9.35%
Monthly SIP amount: Rs 10,000
Total investment in 5 years: Rs 6,00,000
Total value of SIP after 5 years: Rs 7,59,290
lump sum fund performance
Return in 5 years: 9% per annum
One Time Investment: Rs 1,00,000
Investment value after 5 years: Rs 1,54,074 (Rs 1.54 lakh)
(Source: value research)
FD option
Talking about FD, it is a safe option, but it gives returns only as per the pre-determined interest. Currently, most of the banks are giving interest around 6 percent to 7.5 percent for FD of 1 to 5 years. The return in this is stable but it is already fixed. Once an FD is locked, the fixed return does not change throughout the tenure. Debt funds do not guarantee returns. At the same time, returns are guaranteed in FD. That means the risk in this is negligible. If you make an FD for 5 years, you also get the benefit of tax exemption under 80C. However, the interest received on maturity is taxable. If the interest income is more than Rs 40 thousand in a year, then the bank deducts 10 percent TDS. On the other hand, debt funds are a better option in terms of liquidity.
(Note: There is no guarantee that the past returns in any debt mutual fund will continue or not. This may or may not continue in the future. There are risks in the market, so seek expert advice before investing. )
