An asset allocation framework for debt mutual funds with Suyash Choudhary

Zerodha Educate

14-01-2021 • 1 hr 9 mins

All the issues in the debt mutual fund space in the past 3 years have highlighted just how important it is to get your debt allocation right. But unfortunately, a lot of investors spend a lot of time thinking about equity in when deciding their asset allocation but take the debt part of the allocation for granted. And this has come back to haunt a lot of investors ever since the IL&FS crisis.

In the previous episodes, we have spoken at length about why you need debt in your portfolio and the right way to think about debt. But we figured investors need a framework on how to go about getting their debt asset allocation right.  So, we caught up with Suyash Choudhary, the Head of Fixed Income at IDFC Asset Management. In this absolutely brilliant conversation, Suyash talks about:

  1. How his career in the markets started
  2. How the Indian debt markets and debt mutual funds have evolved throughout his career
  3. The core reason for having debt in a portfolio
  4. Core and satellite approach to debt asset allocation
  5. Pitfalls of diversification in debt
  6. Is it wise to rely on common rules of thumb when investing in debt
  7. Should investors invest in credit risk or high yield funds?
  8. Biggest lessons for investors in the last 3 years
  9. How should savers and retirees think about the current challenging low-interest rate environment?
  10. His personal investing philosophy, investing mistakes, lessons and favourite books

You can check out these previous conversations on investing debt:

Understanding what's happening in the debt markets with R Sivakumar, CIO of debt at Axis Mutual Fund
Should you invest in debt mutual funds with Arvind Chari of Quantum Mutual Fund

If you have any questions on the topics discussed in the episode, do post them here.

You can also check out the Varsity module on personal finance to learn more about the basics of debt mutual funds