Is this a good time to invest in gilt and income funds via SIPs?
The state of fixed income funds has changed dramatically over the last couple of months, since the massive FII outflows were seen from the Indian fixed income market. The depreciating currency has only made the fixed income space even more volatile. To add to that, interest rates have gone up and that trend will prevail for a good time to come. Hence, for individual investors, fixed income funds are not a good investment choice at the moment. However, long term investors who have a fixed timeframe in mind can opt for Fixed Maturity Plans (FMP). Investments made in them today can yield high, tax efficient returns. The only compromise would be on interim liquidity.