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Only savvy investors should enter into floating-rate funds: Analysts

Select a debt fund whose average duration is lower than the investment horizon

Topics
Debt Funds | Mutual Funds | CPI Inflation

Sanjay Kumar Singh  |  New Delhi 

funds, investments, stocks, valuations, returns, investors, MFs, mutual funds, savings
In a rising rate scenario, most debt funds (except short-duration ones) see mark-to-market losses. Floating-rate fun­ds are self-adjusting in nature

Interest rates could harden in the near future. One category that can protect investors from the price volatility seen in most debt funds in such a scenario is floating-rate funds. Ten fund houses currently offer them and have cumulative assets under management of Rs 69,730.9 crore. The new fund offer of Tata Floating Rate Fund, which closes on July 5, is also underway.

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Read our full coverage on Debt Funds

First Published: Wed, June 23 2021. 06:10 IST

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