Volatility in the debt market is a function of liquidity and depends on government borrowings, RBIs intervention, auctions and other macro economic variables. We evaluate liquidity in the system and other economic variables before taking a view on the interest rates. We expect a soft interest rate scenario and therefore have a medium term duration in our portfolio. A risk investor in the current market situation should invest in a liquidity fund for short periods. For the longer term we have our gilt and income funds.
Higher risk is associated with higher returns.
Investors in balanced funds should have a time horizon of 3-5 years for investing and obtaining good returns. An investor must understand his own capacity for risk and choose his portfolio accordingly. A fortune in black gold. All rights reserved.