Know how the returns are fixed for the Fixed Income funds

Have we ever taught how fixed are the returns from Fixed Income or Debt Funds. Fixed Income funds invest in Fixed Income securities. However, the irony is that the name is only fixed but the returns are certainly not in any of the Fixed Income funds. To understand the risk of investing in Fixed Income funds, we have to understand the risks of securities in which they invest.

The common risks associated with fixed income securities are credit risks, interest rate risks, liquidity risks, basis risks, yield curve risks etc. Most of the risks are well understood by the investor community and even if they are not understood, then they don