All investors should have a portion of their investment in debt: Axis Mutual Fund

In this episode of ‘Mutual Fund Corner’, R Sivakumar, Head-Fixed Income at Axis Mutual Fund, and Raghav Iyengar, Chief Business Officer at Axis AMC discussed about debt exposure in portfolios and got into an in-depth understanding of long-duration bond funds. Iyengar said debt mutual funds are a little complicated, but it has to be part of every investor portfolio.

“All of us know this debt markets and equity markets are very different in their behavior. So you need to have a little bit of debt to cushion the shock of anything happening in the equity market space," he said.

On how to approach debt in a rising interest rate environment, Sivakumar said, “We must always remember that when we are making investments, we want interest rates to go up, because that's the kind of rate at which we invest into our portfolio. When we want to redeem or when we are in the process of exiting, we want interest rates to be low.”