Advantages of Debt Mutual Funds

 


 Debt with Lower Risk Since mutual funds invest primarily in fixed-income securities with steady returns, they are seen as less hazardous than equities funds.

 A Regular Income

These funds are a great option for retirees and income-focused investors since they offer a consistent income stream in the form of interest and dividend payments.

 By distributing assets among different debt instruments, diversification debt mutual funds lessen the impact of defaults by any one issuer.

Tax efficiency 

Long-term capital gains tax, which is lower than short-term capital gains tax applied to equity funds, is applicable to debt mutual funds held for longer than three years.


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