Debt Schemes

Debt Mutual Fund Schemes are investment funds that primarily invest in fixed income securities such as government bonds, corporate bonds, treasury bills, corporate debt instruments, and money market instruments. These funds aim to provide stable returns and capital preservation with relatively lower risk compared to equity-based investments.

Also known as Fixed Income Funds or Bond Funds, debt schemes focus on generating returns through interest income and gradual capital appreciation from fixed-income securities.

Debt funds offer several advantages, including lower investment costs, relatively stable returns, strong liquidity, and a higher level of safety compared to many other investment options.

These funds are particularly suitable for risk-averse investors who prefer steady income with lower market volatility. Since debt funds are generally less volatile than equity funds, they are considered a safer investment option for those looking to maintain stability in their portfolio.

At AFS Mutual Fund Distributor, we guide investors in selecting the right debt schemes based on their financial goals, risk tolerance, and investment horizon, helping them build a balanced and secure investment portfolio.

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Debt Schemes Sub-Types

Exploring Debt Schemes

Money Market Funds

Money Market Funds are open-ended debt mutual fund schemes that invest in short-term money market instruments such as treasury bills, commercial papers, certificates of deposit, and other highly liquid financial assets.

Long Duration Funds

Long Duration Funds are a category of debt mutual funds that invest in debt securities with a Macaulay Duration of more than seven years. These funds typically include investments in long-term government bonds, corporate bonds, and other fixed-income instruments with extended maturities.

Floater Funds

Floater Funds are a type of debt mutual fund that primarily invest in floating-rate debt instruments. As per regulations, these funds are required to invest at least 65% of their total assets in floating-rate securities.

Medium Duration Funds

Medium Duration Funds are a category of debt mutual funds that invest in debt instruments with a Macaulay Duration of approximately three to four years. The Macaulay Duration represents the average time required for an investor to receive the cash flows from the fund’s underlying investments.

Dynamic Bond Funds

Dynamic Bond Funds are a type of debt mutual fund that have the flexibility to invest in various types of debt instruments with different maturities. The allocation is not fixed and can change depending on market conditions.

Banking And PSU Funds

Banking and PSU Funds are a category of debt mutual funds that primarily invest in debt instruments issued by banks, public sector undertakings (PSUs), and public financial institutions. As per regulations, these funds are required to invest at least 80% of their total assets in such securities.

GILT (Government Issued Long-Term) Funds

GILT Funds are a type of debt mutual fund that primarily invest in government securities issued by the central or state governments. As per regulations, these funds must invest at least 80% of their total assets in government securities with different maturity periods.

GILT Funds With 10 Years Constant Duration

GILT Funds with 10 Years Constant Duration are debt mutual fund schemes that invest primarily in government securities while maintaining a constant portfolio duration of around 10 years. As per regulations, these funds must invest at least 80% of their assets in government securities.

Ultra-Short Duration Funds

Ultra-Short Duration Funds are a category of debt mutual funds that invest in debt instruments with a Macaulay Duration of approximately three to six months. These funds typically invest in short-term money market instruments, treasury bills, commercial papers, and corporate debt securities.

Low Duration Funds

Low Duration Funds are a category of debt mutual funds that invest in debt instruments with a Macaulay Duration of approximately six to twelve months. These funds typically include investments in short-term corporate bonds, treasury bills, commercial papers, and other money market instruments.

Overnight Funds

Overnight Funds are a type of debt mutual fund that invest in debt instruments with a maturity of just one day. Because the investments mature daily, these funds carry very low interest rate risk and minimal credit risk.

Liquid Funds

Liquid Funds are a type of debt mutual fund that invest in short-term debt instruments such as treasury bills, commercial papers, certificates of deposit, and other money market securities. These instruments usually have very short maturity periods, making liquid funds a low-risk investment option.

Short Duration Funds

Short Duration Funds are a category of debt mutual funds that invest in debt instruments with a Macaulay Duration of approximately one to three years. These funds typically include investments in government securities, corporate bonds, debentures, and other fixed-income instruments.

Medium to Long Duration Funds

Medium to Long Duration Funds are debt mutual fund schemes that invest in debt instruments with a Macaulay Duration of approximately four to seven years. These funds typically include investments in government bonds, corporate bonds, and other fixed-income securities with medium to long-term maturities.

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