Young investors often hear that they have decades ahead of them and can therefore afford to take higher equity risk. While equity can indeed remain the core of a portfolio for long-term wealth creation, experts say this does not mean investors in their 20s or early 30s should avoid debt mutual funds altogether.
Debt can play a role in providing stability, liquidity and diversification, particularly when the investment goal is closer or when market volatility makes it difficult to stay invested.
Being young does not mean going 100% into equity
Sanjiv Bajaj, Joint Chairman & MD, Bajaj Capital, said young investors should not look at the equity-versus-debt decision in black-and-white terms.
A 25-year-old may have a long investment journey and…