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What are top debt funds that people are buying and selling?


What are top debt funds people are buying and selling?


With the recent events of Franklin Templeton AMC winding up 6 of its debt mutual funds; The debt mutual fund section is a hot topic among everyone. There is a panic created among investor about debt mutual funds whether they are safe to invest or not. There is a great article covering this topic; Read - Franklin Templeton debt funds- What went wrong?

With this in mind, let's look at what's happening in the debt mutual fund category in last 1 year. In which debt funds investors are putting money and from which debt funds they are taking out money.

All debt fund average AUM for last 1 year

We looked at the data of debt fund investments in all of the debt funds combined in last 1 year; we notice that there is a significant dip in the average AUM for debt funds in March 2020 compared to Feb 2020. see below figure for more details.



Liquid fund average AUM for last 1 year

Investors took out a major chunk of money in March 2020 from liquid funds. Analyst say this is normal for every year March as institutions take out money to take care of Yearly closure activities.


Overnight fund average AUM for last 1 year

There is a huge inflow into overnight fund in March 2020. Is it because people are rushing to safety?


Money market fund average AUM for last 1 year

Money market funds have seen a 10% dip in average AUM.


Low duration fund average AUM for last 1 year

Low duration fund also saw a 10% dip.


Short duration fund average AUM for last 1 year

Short duration funds remained stable for the entire year


Ultra short duration funds average AUM for last 1 year

Ultra short duration fund have seen a massive drop in Average AUM. Are investors worried of the type of investments in these funds?



Medium to long duration fund average AUM for last 1 year

Medium to long duration funds also have seen some exits. The dip in AUM is not significant as the total AUM is small.



Long duration fund average AUM for last 1 year

Having a small base, long duration funds have seen some inflows.


Gilt fund average AUM for last 1 year

Having a small base, Gilt funds have seen some inflows.



Dynamic bond fund average AUM for last 1 year

The Dynamic bond funds AUMs have been constantly declining since last 1 year.


Corporate fund average AUM for last 1 year

Corporate bond fund have seen constant inflows in last 1 year.



Credit risk fund average AUM for last 1 year

Cerdit risk funds have seen massive decline in their AUMs. This is the category that is hardest hit in the debt fund segment because of so many defaults recently.


Banking and PSU fund average AUM for last 1 year

Banking and PSU funds have seen constant increase in inflows in last 1 year.


From above; It is quite evident that investors are deserting the debt fund segment in fear of capital erosion. There is an excellent about safety of debt fund which you can read here - Are debt funds safe?

We will be periodically reviewing the mutual fund investments so stay tuned to this blog. Cheers!
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