I would like to park about 5 Lakhs in debt MF. Aim is to utilize principal and return towards Payments for real estate which are expected in an years time frame. However, I am not sure if I should put this money in Liquid v/s Ultra Short or Short Term v/s Long Term Debt Fund. My investment horizon is between 1 to 2 years. Any suggestion on what is best suited in this case? Any particular funds which are likely to give more returns? How much diversification is recommended in this case? Park 5 Lakhs in 1 fund or take 2-3 funds?
It is pretty simple. As you want to invest for 1-2 years to pay for the expected purchase of real estate, you should invest in short term debt funds only. There is no need of any diversification etc. as your investment horizon is pretty short.
You can select a good short term fund from here https://www.advisorkhoj.com/mutual-funds... and go with your investments.
Thanks for writing to Advisorkhoj.
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