Archive · 23 Sep 2025
Credit Risk Funds Outperform Equity in Past Year
Debt mutual funds, often seen as safer than equity funds, have surprised investors with high returns in the last year.
Credit risk funds, which invest in bonds from companies with a higher risk of not paying back their debt, have delivered returns up to 22%.
While these funds offer potentially higher rewards, they also come with greater risk, and investors should consider the risk before investing.
Several other types of debt funds exist, with varying levels of safety and potential returns.
Debt funds have provided surprisingly high returns in the past year, in contrast to expectations.
DSP, HSBC, and Aditya Birla Sun Life Credit Risk Funds are discussed as examples.
These credit risk funds invest primarily in low-rated corporate bonds.
These funds offer the potential for higher returns but also have a higher default risk.
Investors should be aware of credit risk before investing.
- Who
- Investors
- What
- Credit risk funds have delivered high double-digit returns in the past year.
- When
- Past year
- Where
- Not explicitly stated
- Why
- These funds invest mostly in low-rated corporate bonds.
- DSP Credit Risk Fund (1-year return)
- 22.62%
- HSBC Credit Risk Fund (1-year return)
- 21.38%
- Aditya Birla Sun Life Credit Risk Fund (1-year return)
- 17.04%
- Fund Focus
- Low-rated corporate bonds
- Risk Category
- Moderately High
