Should I Invest in Debt Mutual Funds?
Interest and returns are the terms for which everyone makes an investment. There are several mutual fund schemes which provide high returns to the investors, but are all of them suitable for your requirements? Yes, this question needs to be asked every time you wish to invest your hard-earned money. This blog is for those who are looking to invest their monies in the debt mutual funds but are confused whether they should go for it or not!
Debt mutual fund plans in India are being considered for those investors who have the desire to make a good income in a short span of time while preserving their invested capital. They have investments in the short-term money market and debt instruments which tend to offer recurrent income. Many of us make savings or fixed deposit bank accounts in order to get a fixed amount of returns while preserving the capital. But have you ever analysed debt funds? It is one of the most-promising investment avenues which provides extraordinary higher returns which are around 8-9% in a short span of time.
There are several benefits of investing in this plan which include the following:
- Safety of Capital :- The foremost factor that makes debt mutual fund investing favourable is the security that is provided to the capital being invested in Debt mutual fund plans in India. The investments are made in the instruments with high credit rating, i.e., those with low risk of losing capital. Moreover, mutual funds invest the money in government securities as well which further provide safety to the money.
- Higher Post-Tax Returns :- The returns offered by debt mutual fund plans are around 8-9%. Though they are volatile in nature, the investors must make a choice in an appropriate manner so that they do not lose the worth of their capital in any way. However, the debt mutual funds are actively managed by the fund managers, and thus provide returns which are higher as compared to other alternatives irrespective of the market moves.
- High Liquidity to Redeem Funds :- If we compare the liquidity factors of the debt funds, we can conclude that they are more beneficial in comparison with others. The investors can redeem their funds from the investments as per the requirement in a feasible manner. The schemes do not have any exit load(except some schemes) as well, and thus, the redemption shall not lead to any extra cost on investment values.
- Fixed Income :- The returns earned on debt mutual funds are fixed in nature. The reason being is that they have investments in such instruments which provide recurrent income to the investors. With this, one can attain financial stability as well and can gain superior profits over a period of time.
- Capital Growth in Long Run :-Certain plans falling in the debt mutual fund are long-term in nature, and they provide long-term capital appreciation along with financial stability to the investors. Those who want to make a long-term investment in safer investment avenues can park their money in this plan in order to gain substantial growth in their future.
With these parameters, one thing is absolutely clear that the benefits of debt mutual funds are considerable for the investors. One simply needs to opt for the right investment avenue for their portfolio as per one’s requirement. If you have a question in mind that whether you should go with debt investing or not, then you must make it clear with the above explanation.
If you have the goal to attain financial stability and gain capital growth while preserving the capital being invested, then Debt Mutual Fund is the best choice for you. Our fund advisors will help you in making the right choice of fund, by providing unbiased advice as per your financial needs. You must get associated with the team at MySIPonline to make a worthy investment for your future.
- LTCG Tax Is Not As Negative As it Seems; Here’s Why?43064 min read Jan 01, 1970
- Sensex Plunges Over 1000 Points; Should You Buy or Hold Your Investments for Correction?44033 min read Jan 01, 1970
- Sensex Dives Nearly 840 Points: Things to Consider and Experts’ Take44983 min read Jan 01, 1970