Bank of India Debt Mutual Funds

Investment Objective

The Bank of India Debt Mutual Fund aims to stimulate funds by investing their corpus in Debt-related products. The market’s debt instruments include treasury bills, corporate bonds, commercial papers, and government securities. 

Risks Involved in Bank of India Debt Mutual Fund

The Bank of India Debt Mutual Fund is an investment instrument where investors can choose to allocate their funds to debt instruments. However, the corpus invested is prone to credit risk, inflation, reinvestment risk, and interest rate risk. Investors inclined to invest in debt instruments must meticulously research the risk associated with this avenue. 

Return Potential of Debt Mutual Funds in Bank of India

The Bank of India Debt mutual funds are less volatile, and their returns are not as substantial if you compare them to their equity mutual funds counterparts. The returns on the debt mutual funds are generally more consistent as the money is invested in fixed-income avenues such as government bonds, corporate securities, corporate debt securities and other such money market instruments.  

Who Should you Invest in Bank of India Debt Mutual Funds? 

Investors with the following goals should park their investment in the Bank of India Debt Mutual Fund. 

• Investors who are inclined to invest in a low-risk instrument. 
• Investors willing to park their corpus in a safe avenue for a short period. 
• The investors who want to avail of high liquidity. 
• The investors who want lucrative and consistent returns on their investments. 

Factors to Consider Before Investing Debt Mutual Funds in Bank of India

The investor must account for the following factors before investing in the Mutual Fund Debt. 

• The amount they want to invest in the product. This investment option offers higher liquidity to their investors.

• The scheme must align with their investment objectives. The Bank of India Debt Mutual fund is more suitable for risk-averse investors. 

Tax on Bank of India Debt

The taxes will be levied from the investors based on the following factors: 

Short-term Capital Gains 

If an investor has withdrawn their proceeds before three years of their investment, the tax would be levied concerning the investor’s tax slab. 

Long-Term Capital Gains

An LTCG tax of 20% will be levied on the investment if the gains are more than three years.