Gilt with 10Y Constant Duration Funds
Last Updated on 22 Jun 2026
3 Year Average Returns
0.00%
Funds on Anand Rathi
0
Gilt with 10Y Constant Duration Funds to Invest in 2026
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The value of your investment after 5 Years will be
₹4,12,432
Invested Amount
₹3,00,000
Est. Returns
₹1,12,432
What are Gilt fund with 10 year Constant Duration?
A Gilt fund with 10 year constant duration is a debt mutual fund that invests only in government securities (G-Secs) and maintains an average portfolio duration of around 10 years at all times.
Unlike other debt funds, where duration may change depending on market conditions, a 10 year gilt fund keeps its Macaulay duration close to 10 years consistently. It is highly sensitive to interest rate movements.
It can also be referred to as a sub-category of a Gilt fund, more specific to duration.
Top Features Of Gilt Fund With 10 Year Constant Duration?
Let's understand what makes this category different.
1. Major Government Exposure
A gilt fund with 10 year constant duration invests only in central & state government securities (inclusive of T-bills). As a result, the exposure is adequate compared to other options.
2. Fixed 10-Year Duration Strategy
The fund manager maintains a portfolio duration close to 10 years, regardless of the rate environment. This creates stable interest rate sensitivity with respect to the portfolio.
3. Interest Rate Impact
Because the duration is long, even small changes in interest rates can significantly impact NAV. When rates fall → NAV rises sharply. When rates rise → NAV could fall as well.
4. Suitable For Tactical Allocation
Many investors use 10 year gilt fund when they expect interest rates to decline, but wish to hold G-secs. Considering the scheme's strategy, the fund manager selects the right instruments for investment.
How Does Gilt Fund With 10 Year Constant Duration Work?
Let's understand the working of 10 year Gilt fund with a simple flow.
With the pooled funds, the fund manager allocates the majority of the investment to G-secs and T-bills, with the remainder in other debt and money market instruments. This allocation can differ across different 10 year gilt fund schemes.
During the tenure, if interest rate cuts are announced, the gilt fund with 10 year duration holding these bonds sees an increase in NAV - Net Asset Value.
Likewise, if inflation rises again and rates increase, the NAV of 10 year gilt fund may correct in the short term.
Who Should Invest In Gilt Fund With 10 Year Constant Duration?
You may consider investing in Gilt fund with 10 year duration if you:
- Have a 5–7+ year investment horizon.
- Understanding of interest rate cycles.
- Comfortable with NAV volatility.
- Want lower credit risk exposure.
- Expect interest rates to fall over the medium term.
But remember, if you panic when you see short-term negative returns, any MF category fund may feel uncomfortable.
How to invest in Gilt fund with 10 year Constant Duration with Anand Rathi?
Planning to invest in 10 year Gilt Funds with us?
Investing in debt funds with Anand Rathi is - Simple and Digital.
Here's how you can invest:
1. Open Or Log In to your Account
Visit the Anand Rathi website or the ARInvest app. Open your demat account or log in to the app securely.
2. Go To Debt Funds Section
Navigate to "Invest" → Debt Funds → Search for "Gilt fund with 10 year constant duration."
3. Compare Schemes
Check portfolio composition, expense ratio, historical performance, and fund house credibility.
4. Choose Investment Mode
You can invest through – Lumpsum investment or an SIP investment. Choose based on your cash flow and market view.
5. Confirm And Track
Complete the transaction and monitor your equity investment in 10 year gilt fund through your dashboard.
Factors To Consider Before Investing In Gilt Fund With a 10 Year Constant Duration
Before investing in Gilt funds with 10 year duration, consider;
1. Interest Rate Outlook
The performance of the Gilt fund depends on the interest rate announcement. Understanding how they perform in the long term is important. If rates rise, there is a chance of a short-term correction.
2. Investment Horizon
Since these Gilt funds have a prolonged duration, the minimum holding period also remains above five years or longer. Hence, it's equally important to check your investment horizon, since this is not a short-term parking option.
3. Volatility Tolerance
Even though it invests in government bonds, the NAV can move sharply with interest rate fluctuations. Be mentally prepared.
4. Portfolio Allocation
A gilt fund with 10 year constant duration should be part of a diversified debt allocation. Don't put the entire debt allocation into one category.
5. Expense Ratio
A lower expense ratio could improve long-term returns, so compare with other funds before investing.
Taxation Rules On Gilt Fund With 10 Year Constant Duration
As per MF tax rules, any investor who has invested or will invest in Gilt funds (10 years duration) falls into two categories:
- Before April 1, 2023, but Sold after July 23, 2024 - LTCG (12.5% - without indexation), STCG (slab rate).
- On or after April 1, 2023 Irrespective of the holding period, Gains are taxed as Short-term capital gains (STCG) at Individual slab rates.
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Disclaimer
The information provided on this page is for informational purposes only and should not be construed as investment advice, recommendation, or solicitation to buy or sell any securities or financial pr...
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