Investment in Debt

POSTED BY rakesh ON July 20, 2013 11:09 pm ONE COMMENT

I have invested some money in the following
BSL Income Plus
IDFC Dynamic Bond
kotak Bond Plan
SBI Magnum Income
What does it mean if there is negative return in a month
I have opted for qtrly dividend Will I get dividend or there may be no dividends too
what is the expected rate of returns over a period of one year
any lock in
Would appreciate a reply

One reply on this article “Investment in Debt”

  1. BanyanFA says:

    Debt funds have two returns combined into one :
    1. The return of interest payouts on investments done by the fund
    2. Capital gain on investments due to movement of interest rate in the economy.

    The return on point 1 is generally between 8-12%. However, point 2 tends to fluctuate the overall return of a debt fund from being negative to over 20%. In the current economic situation, I would expect debt funds to give a return of around 9-12% over next 1 year.

    There is generally no lock in period for debt funds. However, there would be an exit load of around 1% if you sell before 1 year.

    You won’t get any dividend if the fund doesn’t declare any. However, generally the fund ends up declaring dividend based upon your dividend frequency.

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