Tata Debt Mutual Fund

Investment Objective

Tata MF Debt Funds aim at providing investors with regular income and safety of capital over the short to medium term. These funds invest in fixed-income generating securities like treasury bills, government securities, and other money market instruments. These funds provide investors with regular income and safety of capital. Tata MF Debt funds are suitable for conservative investors who are seeking capital appreciation and regular income over 3 to 4 years. These funds are relatively stable compared to equity funds and may lend stability to an equity-oriented portfolio.

Risks Involved in Tata Debt Mutual Fund

Tata MF Debt funds carry low to moderately high market risk compared to equity funds. The fund value may go up / down as and when the price of underlying debt security changes. The price of debt securities might be affected by the level of interest rates, government policies, tax laws, and other economic developments.

Return Potential of Tata Debt Mutual Fund

Tata MF Debt funds generate higher returns as compared to traditional fixed-income investments. Historically, these funds have been known to deliver average returns of around 7%-10% within a span of 5 years. The level of returns also depends on credit ratings and the duration of the debt funds.

Who Should Invest in Tata Debt Mutual Fund?

Tata MF Debt funds are suitable for conservative investors seeking capital appreciation and regular income for, say 5 years. These funds are relatively stable compared to equity funds and may lend stability to an equity-oriented portfolio. Tata MF Debt Funds aim at providing investors with regular income and safety of capital over the short to medium term. These funds invest in fixed-income generating securities like treasury bills, government securities, and other money market instruments.

Things To Consider Before Investing in Tata Debt Mutual Fund

Before investing in Tata Debt Mutual Fund, consider certain key things to help you determine the best TATA debt mutual fund scheme. These include assessing your risk profile before buying units of debt mutual funds as they are associated with credit risk, interest rate risk, inflation risk, etc., unlike bank fixed deposits.

Tax on Tata Debt Mutual Fund

As per the new tax rule that came into effect on April 1, 2023, debt mutual funds with 35% or less investment in equities will be treated as short-term capital gains and taxed as per the income tax slab of the investors1. The long-term capital gains upon redeeming the units of debt funds benefit from indexation and are taxed at the rate of 20%.