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The great tragedy in the mutual fund space is the temporary closure of DSP BlackRock Micro Cap Fund. So what is the alternative to DSP Microcap? Some common sense perhaps? Maybe asset allocation? No, that is not an attempt at humour, I am serious. Anyways, here is a couple of real alternatives to DSP Microcap until the great fund opens again and why I am not so keen to invest in such funds.

Well, I am keen, but will not have an exposure of more than 10%. Who does not like returns? But risk is the shadow of returns, and managing my portfolio would be harder with the kind of risk these funds pose. Sorry, I don't buy the statements like:

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There are two main risks associated with a debt mutual fund: capital losses due to (1) an increase in interest rates since old bonds are not as valuables as new bonds that offer higher rates; (2) an actual default in the payment of interest or the possibility of default. In this post, I shall introduce a little-known class of fixed income funds - the floating rate debt mutual fund and discuss how it reduces interest rate risk.

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Investors who wish to give debt mutual funds a try often find that they are more difficult to understand than equity mutual funds 🙂 Who would have thought a fixed income product (a bond that offers regular payments like a fixed deposits) would be so hard to understand the moment it can be traded to another party in the middle of its tenure! But that is how it is. In this post, I discuss the types of debt mutual funds available and why it is so hard to choose a category, let alone a debt fund from a category!

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Here are some simple steps to avoid mess-ups when it comes to investing in debt mutual funds. Freefincal has 30+ posts on debt mutual funds. It is high-time that I compiled them into an e-book. I need to finish a couple of posts before I can do that. This is one of them.

Before we look at the features of the sheet, two quick announcements:

  1. V Ramesh, CEO of MF Utility will be joining Ashal and me at the Pune Investor Meet on Feb 26th. You can register via here. Only a few seats left.
  2. My book with PV Subramanyam, You Can Be Rich Too With Goal Based Investing is now available at a massive 30% discount of Rs. 278/- from amazon

If you are an absolute beginner, you can start here:  What is a Debt Mutual Fund?.  The second part is here: What To Look For When Buying A Debt Mutual Fund. All debt fund posts are listed here.

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Each week I try to answer generic questions from readers. Here is this weeks edition. You can use the form below to ask your questions.

Before we look at the features of the sheet, two quick announcements:

  1. V Ramesh, CEO of MF Utility will be joining Ashal and me at the Pune Investor Meet on Feb 26th. You can register via here. Only a few seats left.
  2. My book with PV Subramanyam, You Can Be Rich Too With Goal Based Investing is now available at a massive 30% discount of Rs. 278/- from amazon.

Ramamurthy: On account of advancing age the problem of signature mismatch is arising especially with redemption requests from mutual funds.Is there any way by which I can redeem either part or full from mutual funds without signing the redemption request letter, please?

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