Assess track record in managing rate cycles before investing

The ongoing India-Pakistan conflict and the fear of it escalating have created uncertainty among investors.

- SARBAJEET K SEN

The ongoing India-Pakistan conflict and the fear of it escalating have created uncertainty among investors. While the equity markets have held steady so far, they could take a hit if fear and uncertainty ratchet up further. Investors need an allocation to fixed income to lend stability to their portfolios in this environment.

Moreover, the interest rate environment is uncertain, making it difficult for many fixed income investors to select the right debt fund. While two repo rate cuts have taken place, there is limited room for further reductions by the Reserve Bank of India (RBI). In such an environment, a dynamic bond fund (DBF) can help investors navigate rate cycles effectively.