Longer tenure bond funds top the returns charts in 2020, shows data

Longer tenure debt funds topped the returns charts in 2020, aided by a falling interest rate environment.

Four such categories – long duration, gilt with 10-year constant, gilt, and medium-to-long duration -- have given double-digit returns. Shorter duration funds fared poorer, while credit risk funds were the worst category with returns of 0.3 per cent.

The Reserve Bank of India (RBI) continued its easy monetary policy in 2020 by cutting policy rates and infusing liquidity into the banking system. The repo rate was reduced by a cumulative 115 basis points (bps) and the reverse repo rate by 155 bps. This was after