It’s not clear when the policy-tightening cycle will end. This is the time to lock some money in fixed income instruments such as bonds and fixed deposits. Floating rate instruments give a market related rates of return without much added price volatility. The interest rates are high, interest payments in floating rate instruments also go higher. Here are floating rate mutual funds (debt funds) that have done well recently with increasing rates.
| FUND | AUM (Rs Cr) | NAV | 1wk | 1mo | 3mo | 6mo | 1yr |
| Tata Floating Rate - LTP | 2.97 | 14.93 | 0.1 | 0.6 | 2.4 | 4 | 7.2 |
| Birla SunLife Floating Rate - LTP | 129.73 | 17.60 | 0.2 | 0.8 | 2.3 | 4.7 | 8.5 |
| HDFC Floating Rate Inc-LTP | 1,024.56 | 17.7 | 0.2 | 0.8 | 2.3 | 5.1 | 9 |
| Kotak Floater LTP | 3,990.71 | 16.3 | 0.1 | 0.7 | 2.3 | 4.6 | 8.6 |
| Tata Floater Fund | 5,375.28 | 15.33 | 0.2 | 0.7 | 2.3 | 4.6 | 8.7 |
| Principal NTF - Conservative | 830.34 | 16.22 | 0.2 | 0.7 | 2.3 | 4.6 | 8.5 |
| Canara Robeco Float Rate-STP | 239.45 | 15.93 | 0.2 | 0.8 | 2.3 | 4.8 | 9.1 |
| L&T Short Term FRF | 1.32 | 14.88 | 0.2 | 0.7 | 2.3 | 4.6 | 8.7 |
| SBI Magnum Income - FRP - SPBP | 250.80 | 15.88 | 0.1 | 0.7 | 2.3 | 4.7 | 8.9 |
| Reliance Floating Rate | 1,824.90 | 16.16 | 0.1 | 0.7 | 2.2 | 4.7 | 8.4 |
Birla Sunlife and HDFC’s floating rate funds are good bets.
Returns are absolute returns as of September 29, 2011.
Source of Data: Moneycontrol.com
