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How Debt Mutual Funds Benefit Your Portfolio

In this blog, we'll take a look at Debt Mutual Funds and how they can be used within your own investment portfolio. Cube Wealth simplifies mutual fund investments with QuickSIP and SuperSIP. Get the Cube Wealth app to know more about the best debt funds.
October 27, 2023

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Let’s look at Debt Mutual Funds and how they can be used within your own investment portfolio.

What are Debt Mutual Funds?

Debt Funds invest in fixed-interest generating securities like corporate bonds, government securities, treasury bills, commercial paper, and other money market asset classes. Classed as fixed-income assets as the interest earned on debt securities is pre-decided along with the duration after the debt security will mature. However, there is no guarantee on this low-risk investment. You can consult a Cube Wealth Coach or download the Cube Wealth App.

Returns are expected in a predictable range making Debt Mutual Funds a favourite or conservative investors. Debt Mutual Funds are managed by professional Fund Managers that have strategies they diversify and align their fund to.

What Are Debt Mutual Funds Suitable For?

Ideal for conservative investors to increase returns over the short term of 1-3 years with exposure to low-risk components of the market. Perfect for general wealth creation.

Debt Mutual Funds at a glance




No upfront fees or charges. A fund may have a redemption charge if you wish to exit within a particular time frame, this varies fund to fund. An example is .25% for redemption within 90 days.


You can sell you debt mutual funds at any time however we recommend to hold these for a minimum of 1 year and sell when our Mutual Fund Advisor Wealth First, provides the instruction.

Minimum investment


Minimum reinvestment


Maximum investment


Recommended duration

1-3 years recommended


Low-risk, however, are subject to credit risk and interest rate fluctuations which causes some fluctuation during the lifecycle of the investment. This fixed income asset is not a guaranteed product.



Low risk with more predictable returns than other types of Mutual Fund investments

Not recommended for fast and instant access to funds

Ideal for 1-3 year investments


Higher returns than simply leaving your money in a bank account.


Flexibility of a SuperSIP where you are in control of how much and when to invest.*


Cube Wealth Debt Mutual Fund Advisor

Wealth First is an independent investment advisory firm focused on Treasury and Wealth solutions for corporates, family offices, provident funds, trusts, and HNIs. Founded in 2000, they have a track record that is 50% higher than NIFTY over the last decade.

AUM: ₹8,000 crores

Clients: 1,000

Wealth First Investment Philosophy

Consistency: Study the returns for over 20 years. Must see for consistent returns in at least 15 quarters.

Fund Manager:
Background of the Fund manager, their statistics, performance and reputation.

Fund House:
Analyse the background of the Fund House.

Risk: After following all criteria, they select a fund house with lower risk.

How To Invest In Debt Mutual Funds Via Cube Wealth

We’ve made it incredibly simple.

Select how much you want to invest in this low-risk category of Mutual Funds. Your investment is split across the top two performing funds in this category for risk diversification.

Transfer your funds directly from your bank account into your own Debt Mutual Fund investment. You can consult a Cube Wealth Coach or download the Cube Wealth App.

You have the option to set up an automated bank debit to simplify disciplined investing each month or invest as you go.

Wealth First constantly analyse the market to ensure they are aware of and recommend the highest-performing low-risk debt mutual funds.

When Wealth First updates a mutual fund recommendation in Cube Wealth – we’ve got you covered. You will receive very clear buy, hold and sell instructions on your Mutual Fund investments. It’s all part of the Cube Wealth difference.

Liquid Funds Summary

1. You can safely earn more than your bank account interest by using a Liquid Fund.

2. Liquid Funds provide fast and flexible access to your funds.

3. Relax knowing our expert Mutual Fund Advisor, Wealth First, will always watch the market and recommend the safest, top-performing Liquid Funds for you.


1. How do debt mutual funds benefit my portfolio?

Ans. Debt mutual funds can provide several benefits, including stable income, diversification, liquidity, and potential capital preservation. They are particularly suitable for investors seeking income, capital protection, or a balanced portfolio.

2. What types of debt mutual funds are available?

Ans. Debt mutual funds come in various types, including liquid funds, short-term funds, long-term funds, gilt funds, and credit risk funds, among others. Each type serves different objectives and risk profiles.

3. Are debt mutual funds risk-free?

Ans. Debt mutual funds carry varying levels of risk depending on the type and the securities they invest in. While they are generally less risky than equity funds, factors like interest rate changes and credit risk can impact their returns.

4. How are debt mutual fund returns taxed?

Ans. Debt mutual funds are subject to capital gains tax, and the tax treatment depends on the holding period. Short-term gains are typically taxed at the individual's income tax rate, while long-term gains may receive indexation benefits.


It's important to note that not all debt mutual funds are the same, and each type caters to specific financial goals and risk profiles. Before investing, consider your objectives, risk tolerance, and the fund's investment strategy. Consulting with a financial advisor can also help ensure that debt mutual funds are well-suited to your investment strategy and financial needs.

Want to learn how to pick Mutual Funds? Watch this video to learn more

Cube Wealth Investment Quotes

When everything seems to be going against you, remember that the airplane takes off against the wind, not with it. – Henry Ford

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