Debt fund vs fixed deposit

The bank deposit has been the instrument of choice for generations of low-risk investors. However it is becoming harder and harder to ignore the possibilities presented by debt funds. The two serve a similar function and are close rivals. The primary areas of difference are returns, safety, taxation, and liquidity, with mutual funds having the advantage in terms of tax-adjusted returns, and fixed deposits in terms of safety. Safety First Bank Deposits are one of the safest avenues for savers in India with an almost negligible chance of default (although there have been instances of co-operative and local banks defaulting). But with debt funds, as in the case of all mutual funds, there are no guarantees. Returns are market-linked

This article was originally published on February 07, 2020.