DEBT FUNDS VERSUS FIXED DEPOSITS.

Hye everyone.

Hope you all are doing great .

So today i am here with you all to discuss and tell you about the differences between fixed deposit and debt funds.

So lets us know about each one of them one by one .

1.DEBT -

WHAT IS DEBT OR DEBT FUND ???

A debt fund or a bond fund is the one that invests in bonds or other debt securities .

Bond funds are different from  stocks and money funds .

Bond funds are typically for a period consists of dividends that includes interest payment on the funds underlying 

securities in addition to periodic realized capital appreciation.

They pay high dividends than the money market accounts.

2. FIXED DEPOSITS-

WHAT ARE FDS OR FIXED DEPOSITS ???

It is a financial instrument provided by banks which provides investors a higher rate of interest than a regular savings account.

This is given until the date of maturity .

MAJOR DIFFERENCES BETWEEN A BOND AND A FD-

1.In bonds there are chances of capital appreciation but this is not in the case of fixed deposit.

2.Fixed deposits offer assured return on Investments but debt funds does not offer a fixed return.

3.Bonds liquidity depends if their is an offer price ,whereas fixed deposit liquidity is at reduced /forfeited interest.

4.BOTH OF THEM ARE TAX FREE (interest taxability)

So this is the brief on the differences between bonds and fixed deposit.

Hope you find this article helpful .

Stay safe

Thanks