Amit Sethi
MFs may face various market risks, both domestic and international, which require asset diversification to mitigate impact.
MFs may struggle due to risks arising from a company, which may be underperforming or making losses.
These funds are relatively safer than equity MFs, but they still face risks from interest rate fluctuations.
Interest rate fluctuations in government and corporate bonds can affect the net asset value of debt mutual funds.
Debt mutual funds invest in corporate bonds and could be exposed to the company's default risk due to its losses or bad business.
Diversifying investments across various asset classes and sectors can mitigate market-wide risks and protect the portfolio.
Investors can use an investment advisor's help to reduce the risks involved in mutual funds.
Knowing your risk-bearing capabilities and thorough research can help you find a good investment option.
Compiled By Himani Verma