Financial experts advise individuals with modest risk appetites to invest in debt products rather than equity
Financial experts advise individuals with modest risk appetites to invest in debt products rather than equity. Bank fixed deposits are the most popular type of debt investment among investors, but those with low-risk tolerance who want to outperform bank deposits should take a closer look at liquid funds. As the name implies, these are the most secure mutual funds since they invest in fixed-income securities with maturities of up to 91 days or 3 months, such as treasury bills, commercial paper, government securities, bonds and debentures. Consequently, these funds are perfect for individuals to park their hard-earned money in order to meet short-term financial objectives. However, in fixed deposits, one can invest from 7 days to 10 years, but the returns are only higher in the long term and in the short term one can expect similar returns to savings accounts. If investors had to choose between liquid funds and bank fixed deposits, where should they put their money in the short term?