Term Of The Week
Types of debt mutual funds: Long Duration Funds
Dec 3, 2018Medium to Long duration funds invest in debt and money market securities such that the Macaulay Duration of the scheme portfolio is more than 7 years. The duration of a fund is a measure of its interest rate sensitivity and as such, long duration funds are highly sensitive to interest rate changes. In a rising interest rate... Read More
Types of debt mutual funds: Medium to Long Duration Funds
Nov 26, 2018Medium to Long duration funds invest in debt and money market securities such that the Macaulay Duration of the scheme portfolio is 4 – 7 years. Since the durations of these funds are fairly long, these funds are more sensitive to interest rate changes compared to medium duration funds. In a rising interest rate... Read More
Types of debt mutual funds: Medium Duration Funds
Nov 19, 2018Medium duration funds invest in debt and money market securities such that the Macaulay Duration of the scheme portfolio is 3 – 4 years. Longer the duration of a fixed income security higher is its interest rate sensitivity. Interest rates have an inverse relationship with prices. Since the duration of the... Read More
Types of debt mutual funds: Short Duration Funds
Nov 12, 2018Short duration funds invest in debt and money market securities such that the Macaulay Duration of the scheme portfolio is 1 – 3 years. The funds usually aim to hold the debt and money market securities in their investment portfolios till maturity and accrue the interest / coupon paid the securities. Hence these types of... Read More
Types of debt mutual funds: Money Market Funds
Nov 5, 2018Money market funds invest in money market instruments like commercial papers, certificates of deposits, treasury bills etc having maturities of up to 1 year. Money market instruments are highly liquid instruments and have low interest rate risk owing to their short maturity profiles. The risk profiles of these funds are... Read More
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