It's time to move primarily into short-term funds

With the benchmark 10-year government bond yield rising above 7%, the larger part of your debt portfolio should be in short-term funds having a sound credit profile

The one-week average returns of most long-term debt fund categories have turned negative: Gilt medium and short term (-0.32 per cent); dynamic bond (-0.18 per cent) and income funds (-0.13 per cent), according to Valueresearchonline.com. This has been caused by a spike in interest rates, with the yield on the 10-year government bond rising from 6.73 per cent to 7.06 per cent over the past month. After this spike, investors need to re-examine their debt fund strategy.

Several factors are responsible for the rise in interest rates. The price of crude oil has risen in the international markets owing to