If not equity, corp FDs offer 1-1.5% over debt MFs and banks
Corporate deposits with higher credit ratings are recommended for investors looking to reduce exposure to equities. Top finance companies like Bajaj Finance and Shriram Finance offer higher returns than bank deposits and debt mutual funds, providing a safer investment option, according to wealth advisors.
For looking to cut exposure to equities amid wild swings, with higher could be good alternatives to and bank deposits. Wealth advisors said deposits from top like and offer over 100-150 basis points more than and debt mutual funds. One hundred basis points is 1%."One of the best options for investors to earn higher interest than banks with good is by investing in corporate deposits, where investors have many choices," said Vijay Kuppa, CEO, .
For example, a of Bajaj Finance pays 8.6% for a 42-month period, while Shriram Finance pays 8.7% for a three-year deposit. Senior citizens can earn 25-50 bps more than this. A fixed deposit from pays 7% for a two-three-year tenure. Most debt mutual funds are returning 7-5%% on an annualised basis
While debt mutual funds offer higher liquidity, they do not offer fixed and with no indexation benefits available, they no longer find favour with conservative investors, including retirees who often look for visibility and assured returns.
Distributors also believe that deposit rates have peaked and could head lower over the next few months.
"There is a chance that can come down by the end of the year. Investors can use these deposits to lock in at higher rates," says Nikhil Gupta, founder, . He recommends deposits of Shriram Finance and Bajaj Finance given their strong financials, track record and high rating of these companies.
Source: Stocks-Markets-Economic Times
