Debt Mutual Funds Strike Gold: Market Depths Yield Double-Digit Returns in 2025

Debt mutual funds are on a roll in 2025, unearthing robust returns as investors delve deeper into the market in quest of growth and stability. Medium-term and credit risk funds like Aditya Birla Sun Life Medium Term Plan and Bank of India Credit Risk Fund are leading the pack with spectacular 5-year CAGR returns of 12-13%-a goldmine for moderate-risk and conservative investors.

Falling interest rates and aggressive bond pickings have made these funds very attractive, with dynamic bond and gilt funds also performing well. Fixed-income products are in greater demand as investors seek refuge from risky equities, and the flexibility of debt funds is an added attraction.

Top performers are raking it in through credit spreads and market, making debt mutual funds an appealing choice for investors seeking steady returns in 2025.

 

Sources: Smallcase, Tickertape, ET Money