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Five Best Performing Dynamic Bond Funds to Invest in

Highlights

  • Dynamic bond funds have done remarkably well in the last one year.
  • But which of these funds should you choose to invest in? Check out the list of top performers in this category.

Dynamic bonds are a type of debt funds that follow a dynamic strategy to manage the portfolio of the fund. These funds invest in debt securities such as corporate bonds, government securities, money market instruments and commercial papers. The objective of these funds is to rebalance portfolio basis interest rate movements in the economy. To know more about dynamic bond funds, advantages and whether you should invest, you can read another post of ours-https://www.wishfin.com/mutual-fund/dynamic-bond-funds-definition-advantages-should-you-invest-in-them/

Top Mutual Funds to Invest in Now

Best Performing Dynamic Bond Funds

Axis Dynamic Bond Fund

This fund is offered by Axis Mutual Fund. These are the key points to note about this fund:

  • This fund manages an AUM (assets under management) of INR 551 crores.
  • It was launched on 27th April 2011 and is rated four stars by Value Research.
  • The fund has delivered 9.03% annualized returns since launch.
  • The portfolio has 44 securities with an average maturity of 8.90 years and a yield to maturity of 6.81%.
  • The portfolio has majorly invested in AAA-rated bonds with 90% allocation.

DSP Strategic Bond Fund

This fund is offered by DSP Mutual Fund. These are the key points to note about this fund:

  • This fund manages an AUM (assets under management) of INR 1,477 crores.
  • It was launched on 9th May 2007 and is rated four stars by Value Research.
  • The fund has delivered 8.36% annualized returns since launch.
  • The portfolio has 10 securities with an average maturity of 9.21 years and a yield to maturity of 6.03%.
  • The portfolio has majorly invested in government securities with more than 90% allocation.
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ICICI Prudential All Seasons Bond Fund

This fund is offered by ICICI Prudential Mutual Fund. These are the key points to note about this fund:

  • This fund manages an AUM (assets under management) of INR 2,980 crores.
  • It was launched on 4th May 2009 and is rated four stars by Value Research.
  • The fund has delivered 9.79% annualized returns since launch.
  • The portfolio has 38 securities with an average maturity of 13.04 years and a yield to maturity of 8.02%.
  • The portfolio has majorly invested in government securities and with more than 50% allocation.

IDFC Dynamic Bond Fund

This fund is offered by the IDFC Mutual Fund. These are the key points to note about this fund:

  • This fund manages an AUM (assets under management) of INR 2,182 crores.
  • It was launched on 41st Dec 2008 and is rated four stars by Value Research.
  • The fund has delivered 8.73% annualized returns since launch.
  • The portfolio has 8 securities with an average maturity of 6.68 years and a yield to maturity of 5.86%.
  • The portfolio has majorly invested in government securities and with more than 95% allocation.

SBI Dynamic Bond Fund

This fund is offered by SBI Mutual Fund. These are the key points to note about this fund:

  • This fund manages an AUM (assets under management) of INR 1,507 crores.
  • It was launched on 9th Feb 2004 and is rated four stars by Value Research.
  • The fund has delivered 6.23% annualized returns since launch.
  • The portfolio has 10 securities with an average maturity of 12.04 years and a yield to maturity of 6.35%.
  • The portfolio has majorly invested in government securities and with more than 90% allocation.
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Returns of Dynamic Bond Funds

The table below depicts the returns from these funds in % terms across regular plans:

Fund NameLast 1 YearLast 3 YearsLast 5 Years
Axis Dynamic12.918.259.03
DSP Bond19.148.088.75
ICICI All Seasons11.627.639.61
IDFC Dynamic13.638.319.28
SBI Dynamic12.747.999.47

*These returns are dated 23rd June 2020.

As we can see from these returns that dynamic bond funds have done well in the last five years, especially in the last year. This shows that these funds have been managed well and fund managers have been quick to make portfolio changes at the right time. This also validates the call on interest rates that these fund managers had.

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