In this episode, Radio Dwarka invited Gurpreet Singh, a partner at Hexagon Wealth Advisors, to know more about debt funds and how to invest wisely, various advantages and pitfalls of different types of debt funds and how to earn good returns one's money.
Singh, who hails from a business family, took up Chartered Accountancy at his father's insistence as wanted him to earn a professional degree. Singh, on the other hand, found getting into it easier compared to other professional courses, though later he realised that completing it wasn't a cake walk.
After completing his CA, he started off as a fund adviser and decided to stick to it as it was monetarily rewarding.
When he started off, only two forms of investment were popular — corporate fixed deposits and stock market. While NRIs were keen to explore options in the stock market, retail investors found corporate fixed deposits quite lucrative. During the late Nineties, mutual funds caught the fancy of investors.
"It helped me expand my work portfolio, and I started dealing with debt and equity funds. My professional knowledge came in handy to understand the nuances of taxation involved in this form of investment, and that built our business."
Debt mutual funds invest in fixed income securities where there are fixed rates of interest such as government bonds, treasury bills, corporate fixed deposits, etc. The return generated from these investments is then passed on to the investors. Its biggest advantage is liquidity and offers tax benefits too. It doesn't assure fixed returns but still scores very well compared to other investment modules.
There are different types of debt funds, depending on the time-frame of investment such as money market or liquid, ultra short, short term, corporate bond, income, guild and dynamic funds. There are certain hybrid funds which are a mix of debt fund and equity fund.
One can invest in these debt funds depending on one's investment needs.

To know more, Click on Picture.

Vishal Gupta,
Radio Dwarka,
India’s First Online Community Radio,
Firday, October 28, 2016