Want to buy your dream home?

Let's imagine a scenario where you want to buy a house in two years and need to save around Rs 20 lakh for the down payment. For the money you require in the short-term (less than three to five years), you should avoid investing in equity-oriented investment avenues owing to the volatile nature of the equity markets. You should rather look to invest in some short-duration debt funds. These funds invest in securities having a duration of up to three years and hence are less affected by the interest rate movements as compared to those debt funds having longer maturity profile. You can also look to invest in ultra-short duration funds which have even smaller maturity profile.

This article was originally published on May 24, 2022.