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Things to know about Corporate Bond Funds

Corporate bond funds invests their corpus in bonds which are rated AA+ and above
07 November 2022
    Blog

    As the name indicates, Corporate bond funds primarily invests their corpus in corporate bonds which are rated AA+ and above. These funds are categorized as open-ended debt scheme and invests minimum 80% of its total assets^ in AA+ and above rated corporate bonds.

    ^ Excluding net assets component that is mandatorily required to be invested in liquid assets.

    Benefits of Investing in Corporate Bonds

    • Corporate bond funds are less volatile than other long-term debt schemes
    • These bonds are evaluated and assigned a rating based on credit history and ability to repay obligations. The higher the rating, the safer the investment as measured by the likelihood of repayment of principal and interest
    • Corporate bonds provide an opportunity to choose from a variety of sectors, structures and credit-quality characteristics to meet your investment objectives

    Who should invest?

    • This fund is ideally suited for investors who have an investment horizon of more than 1 year and can see through the Mark to Market volatility over the investment period
    • Suitable for investors considering an alternative investment option could consider allocation in these funds
    • Good option for the investors who are looking for higher fixed income as well as a reasonably safe investment
    • Good alternative to traditional investments for investors belonging to the highest tax bracket

    Consulting your investment advisor is the best way to take any investment decisions before investing to understand all legal, financial and taxation implications.

    An Investor Education & Awareness Initiative by HSBC Mutual Fund

    Visit https://grp.hsbc/KYC w.r.t. one-time Know Your Customer (KYC) process, complaints redressal process including SEBI SCORES (https://www.scores.gov.in). Investors should only deal with Registered Mutual Funds, to be verified on SEBI website under Intermediaries/Market Infrastructure Institutions (https://www.sebi.gov.in/intermediaries.html). Investors may refer to the section on ‘Investor Education’ on the website of HSBC Mutual Fund for the details on all ‘Investor Education and Awareness Initiatives’ undertaken by HSBC Mutual Fund.

    This document is intended only for distribution in Indian jurisdiction. Neither this document nor the units of HSBC Mutual Fund have been registered under Securities law/Regulations in any foreign jurisdiction. The distribution of this document in certain jurisdictions may be unlawful or restricted or totally prohibited and accordingly, persons who come into possession of this document are required to inform themselves about, and to observe, any such restrictions. If any person chooses to access this document from a jurisdiction other than India, then such person do so at his/her own risk and HSBC and its group companies will not be liable for any breach of local law or regulation that such person commits as a result of doing so.

    Mutual fund investments are subject to market risks, read all scheme related documents carefully.

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