Top Gilt Mutual Funds for Investment in November 2024 for Stable Return
Gilt funds are a type of debt mutual fund that invests in government securities, which are also known as G-secs, to generate returns via interest payments.
Advisors of mutual funds are suggesting gilt funds for aggressive or sophisticated debt investors because they believe that gilt funds provide higher returns if the RBI begins lowering the rate of interest.
Gilt mutual funds are the best way to capitalize on a possible decline in interest rates. However, one must be aware that these funds carry a very high degree of risk and are highly sensitive to actual or anticipated changes in interest rates. Therefore, they are best for well-informed investors who understand the risks involved and have a long-term investment horizon.
These funds are not recommended for regular debt investors because they have a high risk and volatility. This fund suffers when the rates increase. The price and yields of bonds move in different directions. When the rate increases, the price of the bond comes down. This drags down the NAVs of the gilt fund schemes.
As per the SEBI rules, the gilt fund schemes must invest 80% of the corpus in government securities. Because this scheme invests in government securities. That is why they don’t have a credit risk. These funds are highly sensitive to interest rate changes.
These few factors make investing more difficult in gilt funds. You should be aware of the rate of interest in the economy.
Top Gilt Mutual Fund to Invest in November 2024
- Nippon India Gilt Securities Fund
- Bandhan G-Sec Fund
- SBI Magnum Gilt Fund
- ICICI Prudential Gilt Fund
- Aditya Birla Sun Life Government Securities Fund
Nippon India Gilt Fund has been in the top third quartile for the past three months. The same scheme had been in the top fourth quartile before. Aditya Birla Sun Life Government Securities Fund has been in the top third quartile for the last seven months. Bandhan Government Securities Fund has been in the top second quartile for the past eight months.
