Best medium to long duration funds to invest in 2022 (2022)

Synopsis

Medium to long duration debt mutual funds invest in debt and money market instruments with the Macaulay's duration of four to seven years.

Best medium to long duration funds to invest in 2022 (1)

Debt mutual fund investors emphasise on the safety of their investments. Perhaps that explains why certain debt mutual fund categories are largely ignored by regular investors. Most mutual fund managers and advisors mostly ask conservative debt investors to stick to safer short-term debt funds like overnight funds, liquid funds, short duration funds, among others. No wonder, most mutual fund investors are unaware about the existence of medium to long duration/term debt mutual funds.

According to Sebi norms, medium to long term funds have a mandate to invest in debt and money market in such a way that the Macaulay's duration of the portfolio is four to seven years. Since these schemes invest in long-term debt instruments, they are considered risky. Even a minor hardening of interest rate could make these schemes extremely risky and volatile. In simple terms, investors might lose money in such a scenario. That explains why advisors do not speak about these schemes often.

Long term debt schemes are extremely sensitive to interest rate changes. They lose money when interest rates go up. When rates are falling, they benefit the most. According to investment experts, when one invests for a long period in debt instruments, the investor is forced to go through an interest cycle that would have an upward and downward phase. This means the investor would see a lot volatility and sometimes losses when the interest rates start hardening or going up. Investment advisors believe that many conservative investors would not be able to go through such turbulent phase. They can avoid this only if they time their entry and exit into long-term debt funds. Many investors would find it difficult to predict the interest rate movements and getting in and out of the schemes. That explains the advice to stick to short term funds.

However, this doesn't mean that you should not be familiar with the medium and long duration category. Those with risk appetite and long investment horizon, can invest in these schemes with the help of competent mutual fund advisors. The only basic requirement is that you should be aware of the extra risk in these schemes. Here are our recommended mid to long duration debt funds.

Best medium to long duration debt funds to invest in 2020

  • SBI

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    Magnum Income Fund
  • ICICI Prudential

    Bond Fund
  • Aditya Birla Sun Life Income Fund

If you want to know about our methodology, you can take look at it.

ETMutualFunds.com has employed the following parameters for shortlisting the debt mutual fund schemes.

1. Mean rolling returns: Rolled daily for the last three years.

2. Consistency in the last three years: Hurst Exponent, H is used for computing the consistency of a fund. The H exponent is a measure of randomness of NAV series of a fund. Funds with high H tend to exhibit low volatility compared to funds with low H.

i)When H = 0.5, the series of return is said to be a geometric Brownian time series. These type of time series is difficult to forecast.

ii)When H
iii)When H>0.5, the series is said to be

persistent

. The larger the value of H, the stronger is the trend of the series

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3. Downside risk: We have considered only the negative returns given by the mutual fund scheme for this measure.

X =Returns below zero

Y = Sum of all squares of X

Z = Y/number of days taken for computing the ratio

Downside risk = Square root of Z

4. Outperformance: Fund Return – Benchmark return. Rolling returns rolled daily is used for computing the return of the fund and the benchmark and subsequently the Active return of the fund.

Asset size: For debt funds, the threshold asset size is Rs 50 crore

(Disclaimer: past performance is no guarantee for future performance.)


Best medium to long duration funds to invest in 2022 (2)

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FAQs

Which is the best mutual fund to invest in 2022? ›

India's best performing mutual funds for May 2022
Name of Fund1-Year Return3-Year Return
ICICI Pru Regular Savings (G)6.276%8.652%
Kotak Debt Hybrid (G)5.087%10.350%
Canara Robeco Hybrid (G)3.452%8.876%
Data Source: Morningstar
6 days ago

Which fund is best for long term investment? ›

Best Long Term Mutual Funds to Invest in June 2022
Fund Name1Y CAGR 3Y CAGR 5Y CAGR Till Date CAGRTill Date CAGR
Canara Robeco Bluechip Equity Fund (G)15.1%12.1%
Parag Parikh Flexi Cap fund (G)22.8%18.4%
IIFL Focused Equity Fund (G)17.9%13.9%
Union Long Term Equity Fund (G)16.5%13.9%
16 more rows

Which MF is best for future? ›

Best Performing Debt Mutual Funds
Fund Name3-year Return (%)*5-year Return (%)*
SBI Magnum Medium Duration Fund Direct -Growth7.76%7.81%
Kotak Dynamic Bond Fund Direct-Growth7.20%7.70%
Edelweiss Banking and PSU Debt Fund Direct-Growth7.71%7.69%
HDFC Credit Risk Debt Fund Direct-Growth8.16%7.64%
6 more rows

Which mutual fund is best for mid term? ›

List of Medium Duration Mutual Funds in India
Fund NameCategory1Y Returns
ICICI Prudential Medium Term Bond FundDebt3.6%
SBI Magnum Medium Duration FundDebt2.6%
HDFC Medium Term Debt FundDebt2.8%
Axis Strategic Bond FundDebt3.8%
11 more rows

Which mutual fund is best for 10 years? ›

1] Nippon India Small Cap Fund: This growth fund has given better return than its category average in last 10 years.

Which is the No 1 mutual fund in India? ›

The table below shows the best debt funds:
Mutual fund5 Yr. Returns
ICICI Prudential India Opportunities Fund Direct Plan Growth--
Aditya Birla Sun Life CEF - Global Agri Plan - Growth-Direct Plan14.09%
ICICI Prudential Multicap Fund - Dividend8.65%
IDFC Government Securities Fund - Constant Maturity Regular - Growth9.56%
6 more rows

Which Bluechip fund is good for long term? ›

List of Large Cap Mutual Funds in India
Fund NameCategory1Y Returns
Canara Robeco Bluechip Equity FundEquity5.8%
Baroda BNP Paribas Large Cap FundEquity7.2%
Invesco India Largecap FundEquity8.2%
Axis Bluechip FundEquity1.4%
12 more rows

Where should I invest for 30 years? ›

The best long-term investments in June 2022:
  • Growth stocks.
  • Stock funds.
  • Bond funds.
  • Dividend stocks.
  • Value stocks.
  • Target-date funds.
  • Real estate.
  • Small-cap stocks.
Jun 1, 2022

Which is the best SIP for long term? ›

Large-Cap Schemes
Scheme Name5-Year Monthly SIP10-Year Monthly SIP
ICICI Pru Top 100 Fund (G)Rs.9,41,591Rs.27,57,958
Quantum LT Equity Fund (G) – Direct PlanRs.9,15,695Rs.28,82,955
Reliance Growth Fund (G)Rs.10,75,057Rs.30,73,348
SBI BlueChip Fund – Reg (G)Rs.9,55,955Rs.28,57,343
6 more rows

Which mutual fund is best for lumpsum? ›

What Are the Best Mutual Funds for Lumpsum Investment?
Fund NameFund Category5 Year Returns
Quant Tax PlanELSS23.92%
PGIM India Flexicap FundFlexi-cap Funds20.62%
Mirae Asset Emerging Bluechip FundLarge and Midcap Funds21.74%
PGIM India Midcap Opportunities FundMidcap Funds21.42%

Which mutual fund is best for long term investment Quora? ›

  • Investing in such types of funds for a long term as i mentioned above you can expect 14–15 per annum compounded return.
  • Two nos. ...
  • 1 kotak standard multicap fund.
  • 2 birla equity fund.
  • While investing invest by sip method.opt for direct plan growth option.this will increase your return.

Which mutual fund is best for 5 years? ›

10 Mutual Funds That Tripled Wealth in 5 Years
  • Reliance Small Cap Fund. ...
  • HDFC Small Cap Fund – Direct – Growth. ...
  • Mirae Asset Emerging Bluechip Fund – Direct – Growth. ...
  • Principal Emerging Bluechip Fund – Direct – Growth. ...
  • HDFC Mid-Cap Opportunities Fund – Direct – Growth. ...
  • Axis Long Term Equity Fund – Direct – Growth.
Mar 28, 2022

What is best investment for medium term? ›

4-6 years is considered medium-term in savings and investment decisions and hence capital appreciation should be your objective here. Corporate bond funds and hybrid funds are best suited for capital appreciation as they are less volatile compared to equity funds which are ideal for wealth creation over long-term.

What are medium to long duration funds? ›

Medium to Long Duration Fund : These mutual funds select bonds/debt for investment such that average maturity (remaining) period for portfolio is between 4 to 7 years (Macaulay duration). Longer duration funds may provide higher returns but are more sensitive to interest rate changes.

Is it good to invest in SBI Magnum Medium duration fund? ›

This fund has continuously performed better than similar funds. You can consider investing in this fund. Medium Duration Fund : The fund has 96.25% investment in Debt, of which 27.04% in Government securities, 66.2% is in Low Risk securities.

Which mutual fund is best for next 20 years? ›

12 Best SIPs For 10-20 Year Investment In FY 21 - 22
Fund Name5-Year Returns (In%)AUM (In ₹ Cr)
Axis Focus 25 Fund20.4319,456
IDFC Banking & PSU Debt Fund7.6218,069
ICICI Prudential Corporate Bond Fund7.9319,104
HDFC Money Market Fund6.4314,185
8 more rows

How do I choose long term mutual funds? ›

Here is a guide to mutual fund investment, you may consider while selecting mutual funds for investments.
  1. Goals. This is the basic. ...
  2. Risk. Risk comes from not knowing what you are getting into. ...
  3. Fund Performance. Fund performance matters. ...
  4. Expense Ratio. ...
  5. Entry And Exit Load. ...
  6. Taxes. ...
  7. Direct Plans.
May 24, 2022

Is mutual fund safe for long term? ›

Mutual funds are great for long term financial goals and should be done for a minimum time frame of five years. Investors should not worry about short-term volatility. If your investment is giving negative returns in the near term don't panic, instead keep investing as you can accumulate more units at the same price.

Which MF has highest return? ›

1) Axis Bluechip Fund Direct-Growth

Axis Bluechip Fund Direct Plan-Growth is an Equity Mutual Fund Scheme launched by Axis Mutual Fund and is the Highest Return Mutual Fund in Last 5 Years.

Which is the best mutual fund to invest in India for long term? ›

List of Long Duration Mutual Funds in India
Fund NameCategory1Y Returns
Quant Flexi Cap FundEquity11.1%
Axis Small Cap FundEquity17.8%
Parag Parikh Flexi Cap FundEquity13.0%
Mahindra Manulife Multi Cap Badhat Yojana FundEquity12.8%
7 more rows

Which type of mf is Best? ›

Which mutual fund scheme should I choose? Capital Protection Funds are the best bet for individuals who want to ensure protection of their principal invested amount. Under such schemes, the funds are split between investment in equity markets and fixed income instruments.

Which MF is best for lumpsum investment 2022? ›

Top Mutual Funds for Lumpsum Investments
  • Canara Robeco BlueChip Equity Fund Direct-Growth.
  • Baroda BNP Paribas Large Cap Fund Direct-Growth.
  • UTI Nifty200 Momentum 30 Index Fund Direct-Growth. ...
  • Nippon India Credit Risk Fund Direct-Growth.
  • HDFC Credit Risk Debt Fund Direct-Growth.
4 days ago

Is Axis Bluechip fund good for long term? ›

Therefore, Large-cap Funds can be expected to perform well in the near future. Axis Bluechip Fund is a Large-cap Fund that has outscored its peers and the benchmark over the long term and rewarded investors with superior risk-adjusted returns.
...
Axis Bluechip Fund: Delivering Robust Long Term Returns.
Scheme NameS&P BSE 100 - TRI
1 Year19.64
2 Year34.23
3 Year15.44
10 more columns
May 5, 2022

Which large cap fund is best for 2021? ›

Best Large Cap Mutual Funds to Invest in 2021
Scheme Name(Absolute (%)CAGR (%)
ICICI Pru Bluechip Fund12.5612.82
Kotak Bluechip Fund16.1912.74
BNP Paribas Large Cap Fund15.9812.57
UTI Mastershare18.0512.55
9 more rows

Where should a 60 year old invest? ›

How to Invest for Retirement at Age 60 the Right Way. One of the best ways to invest for retirement at age 60 is through an IRA, 401(k), or a combination thereof. All of these will allow you to save more money over time. And, you can use tax-free and tax-deferred advantages to pay less to Uncle Sam.

What should I invest in 2021? ›

Here is my list of the seven best investments to make in 2021:
  • Build Your Cash Reserves. ...
  • Stocks – Still the Way to Go in 2021. ...
  • Real Estate. ...
  • Pay down or Pay Off Debt. ...
  • Launch or Accelerate Your Retirement Savings Plan. ...
  • Make 2021 the Year You Begin Investing in Yourself. ...
  • Invest in a Side Business.
Jan 8, 2021

What should a 70 year old invest in? ›

What should a 70-year-old invest in? The average 70-year-old would most likely benefit from investing in Treasury securities, dividend-paying stocks, and annuities. All of these options offer relatively low risk.

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