Most Indians traditionally opt for bank FDs, assuming mutual funds carry higher risk and potential loss. But is this really true? Debt Mutual Funds vs. FDs Debt mutual funds primarily invest in fixed-income securities like bonds, treasury bills, and commercial paper, offering potentially higher returns than FDs, which are fixed-return instruments with lower liquidity. If you wish to know more, reach out to the best mutual fund company in Prayagraj . Why Are Debt Mutual Funds Better Than FDs Higher Potential Returns : Debt mutual funds typically offer higher returns compared to FDs, especially over longer tenures. Over the years, various debt funds have outperformed fixed deposits, offering better growth. Diversification : Mutual funds spread investments across various securities, reducing risk compared to single-bank FDs. This diversification helps reduce the risks of market ups and downs. Liquidity : Debt mutual funds allow more flexibility for withdrawals compared to FDs, which ...