FDs giving negative returns, bonds a good option for fixed income investors: Moneyfront

Fixed income investments is a topic not many are familiar with, but investors are eager to know more about which instruments one should invest in and which to avoid. To find out all about fixed-income investments, CNBC-TV18 spoke with expert Mohit Gang of Moneyfront.

According to Gang, the real interest rates in India have been negative for more than a year now. The rates offered on bank deposits are very low and do not take care of inflation. "So, in real sense an investor in fixed deposit is actually losing money or not making much," Gang said.

For fixed income investors, who want a regular pattern of income and are willing to take some chances with their debt portfolio, there are an array of products that could be utilised to enhance returns.

Among investing options, if one were to go beyond the mutual fund space, one could look at investing in bonds, said Gang and added that there are all kinds of bonds – taxable bonds, bank bonds, PSU bonds, private company bonds etc.

One can also look at investing into structured notes, but for most of the structured notes the ticket-size is huge. Then there are alternate investment funds -- long-short funds -- which are hedging portfolios but the ticket size is one crore and above.

Investors are also looking at peer-to-peer lending and invoice discounting platforms, which are at an affordable ticket size, but there are risks involved in this, Gang explained.