Unlock Financial Tools, Investment Insights, And Expert Guidance – All In One Convenient App !
Visit Our ABCD Page
PLAY STORE
APPSTORE
1800 270 7000
Download
Insurances 
INVESTMENTS 
LOANS 
PAYMENTS 
QUICK SERVICES 
HEALTH INSURANCE 
Health Insurance
Housing Finance
Life Insurance
Mutual Funds
Personal Insurance
SME Finance
Stock & Securities
Home LoanFind customised home loan solutions for your unique needs
Balance TransferFind a better interest rate for your existing home loan
Top up Home LoanGet a loan on your existing home loan to meet your needs
Loan Against PropertyTurn your assets into a financial ally
Personal LoanMeet all your dreams and needs with a collateral-free Personal Loan
Flexi LoanMake loan repayment flexible and hassle-free with Flexi Loans
Instant Personal LoanGet quick funds with Aditya Birla Capital Instant Personal Loan
Long Term Personal LoanEnjoy affordable repayments and a flexible tenure with Aditya Birla Capital
Personal Loan EligibilityCheck your Aditya Birla Capital Personal Loan eligibility
Personal Loan Interest RatesEnjoy low personal loan interest rates for affordable repayments
Are you eligible for a Personal Loan? Find out now!
Calculate Now
Debt FundsDiversify your portfolio and reduce risk with Debt Funds
Equity FundsInvest smartly in Equity Funds to aim for higher returns
Hybrid FundsDiversify your portfolio and reduce your risk with a mix of equity and debt
Retirement FundsGoal-oriented fund with a lock-in period to create a corpus for retirement
Children’s FundsSecure your child’s financial future with solutions-oriented children’s funds
Exchange Traded FundsUnlock a smart, hassle-free way to invest in various assets
Fund Of FundsChoose the smart way to diversify risks and grow investments
Index FundsFollow the benchmark of smart investors to grow your wealth
Calculate wealth creation through lumpsum investment in Mutual Funds
Calculate Now
Equity TradingInvest or trade in equity for attractive returns and long-term capital growth
Margin Trading FacilityGet up to 5X leverage on leading stocks & increase your trading power
BondsGive your portfolio stability with attractive returns
Term InsuranceBring security and peace to life’s unpredictability
Retirement PlansGet a guaranteed regular pension plus lump sum on plan maturity
Savings PlansGet a guaranteed regular pension plus lump sum on plan maturity
ULIP PlansGet the benefits of insurance & wealth creation in one convenient plan
Find out how much life insurance you need with our Human Life calculator
Calculate Now
Health & Wellness PlansMake quality health care affordable and accessible
Super Top-up PlansGet extra coverage when you need it most
Life Insurance
Health Insurance
Mutual Fund
Home Finance
Personal Finance
Stocks & Securities
Debt Funds
No equity risk- Stable returns on investment
- Suits different investment horizons
What are
debt mutual funds?
Debt mutual funds are those that invest a primary part of their portfolio in debt instruments and fixed-income securities. There is low risk and the returns are stable.
Why invest in debt funds?
Liquidity
If you are looking for short-term investments, debt funds can be a good place to park your funds without the risk of capital erosion.
Low risk
Since debt funds invest in fixed-income instruments, volatility risks are low and your capital is usually protected.
Stable returns
You can earn stable returns on investments with negligible chances of loss.
Suitability
You can choose from short-term, midterm and long-term debt funds based on your investment horizon.
Types of Debt funds
Funds Based On Duration
ABCD - One app to build a diversified investment portfolio
Invest in mutual funds online with the ABCD app and build your portfolio one click at a time.
-
A choice of different types of mutual fund schemes -
Online investments with a fully integrated digital platform
-
Facility to switch, redeem and invest more from a single platform
PLAY STORE
APP STORE
Scan the QR code to download our Mobile App
Table of Contents
What are Debt Funds?
Debt funds are mutual fund schemes that invest primarily in debt securities. Debt securities are those that offer fixed income on investments such as government bonds, corporate bonds, debt securities, etc. As such, debt funds have a low risk of suffering volatility and offer moderate returns.
How do debt funds work ?
-
Debt funds invest in debt instruments such as Corporate or Government bonds.
-
Debt funds receive interest from these underlying debt instruments such as bonds.
-
This interest gets added in the fund which result in NAV of these MF funds go higher.
-
NAV price also increases or decreases based on the market interest rate.
Features of debt funds
-
Regular Income
-
Less volatile
-
Steady return with lower risk
-
High Liquidity
How to invest in debt mutual funds?
Use the ABCD app and invest in debt funds in a few clicks. Choose your investment mode - SIP or lump sum and start your investment journey.
SIP
Invest in a regular and disciplined manner every month with SIPs
Lump sum
One-time investment at your convenience
What are the tax implications?
Returns earned from debt mutual funds are taxed in your hands at your applicable tax slab rate.
Secure retirement with Life Insurance
-
Secure regular pensions
-
Save on taxes
Invest and secure with ULIPs
-
Market-linked returns
-
Flexibility: withdraw, switch, top up
FAQs On Debt Funds
A debt fund is a type of mutual fund that invests in fixed-income instruments like government and corporate bonds. They offer stable income, risk diversification, and liquidity. Returns come from interest and capital appreciation, with taxation based on the holding period, making them versatile for various investment goals.
The decision to invest in a debt fund depends on your financial goals and risk tolerance. If you prioritize stability, regular income, and lower risk, a debt fund can be a good choice. However, if you seek higher returns and are willing to tolerate more risk, you might consider other investment options such as equities funds. It's essential to align your investment decisions with your specific financial objectives and risk preferences.
Fixed Deposits (FDs) are typically considered safer with fixed interest and deposit insurance, whereas debt funds entail some risk due to credit risk and interest rate fluctuations.
Debt funds can be well-suited for conservative investors seeking higher interest than traditional Fixed Deposits. They are also suitable for those with a 1-3 year investment horizon and investors looking to diversify their portfolios, balancing equity risks with the stability of debt instruments. Ultimately, the decision depends on individual goals and risk tolerance.
No! Debt funds will be taxed as per your income tax slab.
Other asset class funds
ETF Funds
Invest in funds listed and traded on the stock exchange
Know More
Fund of Funds
Mutual funds that invest in other mutual funds both in India and globally
Know More
Hybrid Funds
Get a mix of equity, debt and other asset classes for a diversified portfolio
Know More
Index Fund
Passively-managed mutual funds tracking a particular index
Know More