Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Min. investment
5 Year Returns
Debt funds invest in all kinds of debt which can also be considered as lending money to the entity issuing the fund, such as treasury-bills, government securities, commercial paper, certificates of deposits, money market instruments, securitised debt, and corporate bonds. These funds have a fixed maturity date and interest rate that the buyers could earn till the maturity of the security. Debt funds invest in a variety of securities, based on their credit ratings. A security’s credit rating signifies the risk of default in disbursing the returns that the debt instrument issuer promised.
Investing in debt mutual funds is generally considered safe due to their focus on fixed-income assets like bonds. However, risks exist, primarily related to interest rate changes and credit quality fluctuations. Conduct thorough research and consider your risk tolerance before investing.
Choosing between Fixed Deposits (FDs) and debt mutual funds depends on factors like investment goals, risk tolerance, and liquidity needs. FDs offer guaranteed returns but lower potential gains, while debt mutual funds provide potentially higher returns with slightly higher risk and better liquidity. Assess your financial objectives before deciding.
Short-term capital gains (if the units are sold before 36 months) in debt mutual funds are taxed as per applicable tax rate of the investor. Therefore, if your tax rate is 30% then short-term capital gains tax on debt fund is 30% + 4% cess. Long-term capital gains (if the units are sold after 36 months) in debt fund are taxed at 20% with indexation. Also, Dividends received by investors are added to their overall income and taxed at the income tax slab rate they fall under.
Debt funds can carry varying levels of risk depending on factors like credit quality, interest rate movements, and fund strategy.
Among debt funds, those investing in government securities and top-rated corporate bonds are generally considered the safest options with lower credit risk.
Yes, you can typically withdraw from debt mutual funds at any time. However, certain funds may have exit loads or penalties for early withdrawals, especially within a short timeframe after investment. Check the fund's terms and conditions for specific withdrawal policies before investing.
Debt funds can be suitable for long-term investment goals, offering stability and potentially higher returns compared to traditional fixed-income options like bank deposits. They help diversify a portfolio and mitigate risk, making them a viable option for investors seeking consistent income and capital preservation over the long term.
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