Interest in mutual funds raised in debt, know what is the reason

Interest in mutual funds is increasing in debt products. The reason for this is the expected change in interest rates. Fund houses like Aditya Birla, IDFC and Kotak have doubled their investment maturity period in bond funds.

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The reason for this is that there is hope of a reduction in interest rates in the medium term. After a lot of waits, such hope is awakened after the cash was inserted in the banking system. In the last two seasons, until Wednesday, the benchmark bond Yield decreased 24 basis points to 7.22 percent.

Efforts to increase the liquidity of the Reserve Bank of India (RBI) and softening of crude oil prices are expected to reduce interest rates next year. Since October, the Bond Yield has declined by nearly 94 basis points. Because of this, Bond prices have increased. A Balasubramanian, CEO of Aditya Birla Sun Life AMC said, "We have been able to get good returns from bond funds due to the upturn in the bond market." Interest rates are still neutral, with the Reserve Bank and Crude oil prices Such signs are happening. "

"In view of this, we have increased the average maturity of debt investment to six years, this period was only 2.5 to 3 years, about one and half months ago."

According to data from December 17, in the past one month, the Aditya Birla Sun Life Dynamic Bond Fund has given returns at an annual rate of 22.68 percent. Manish does manage regular income funds of Aditya Birla Sun Life.

In this way, the IDFC Bond Fund has given returns at an annual rate of 22.35 percent. With these two funds, DSP Strategic Bond Fund is also included in the top three in this category in the last one month.

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