Wealth Tips

How Debt Mutual Funds benefit your portfolio

August 25, 2020

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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.

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

Returns

7-15%

Fees

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.

Liquidity

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

₹15,000

Minimum reinvestment

₹500

Maximum investment

Uncapped

Recommended duration

1-3 years recommended

Risk

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.

Pros

Cons

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 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.

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

Team Cube

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