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Debt funds face market risks too 

February 19, 2014
Priyadarshini Dembla, The Times of India

Like equity funds, investors must look at factors beyond performance while selecting debt funds. There are a few unique aspects that investors must check out before short-listing debt funds for making an investment.

Match investment horizon

Since debt funds are largely categorized on the basis of time periods, investors should select the fund which matches their investment horizon. For instance, for an investment horizon of less than a year, investors can select an ultra-short term or a liquid fund, depending on its aptness in their portfolios. Likewise, for an investment horizon of between one and three years, short-term funds would be more appropriate. However, the investor should bear in mind that higher the maturity of debt funds, more prone they will be to interest rate risks.

Read more: The Times of India

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