FinanceShiksha
Debt Funds
Stable returns with lower volatility. Ideal for short-term goals.
Types of Debt Funds
Liquid Funds:
Park money for few days/weeks. Alternative to Savings Account.
Overnight Funds:
Extremely low risk, 1-day maturity paper.
Gilt Funds:
Invests in Govt securities. No credit risk, but interest rate risk exists.
Corporate Bond Funds:
Higher returns by investing in high-rated corporate companies.
Who should invest?
Investors looking for:
Regular income
Capital protection (relative to equity)
Parking emergency funds
Taxation (Debt):
Gains are added to your income and taxed as per your slab rate (as per Finance Bill 2023).