{"id":24426,"date":"2022-05-30T16:06:28","date_gmt":"2022-05-30T16:06:28","guid":{"rendered":"https:\/\/www.5paisa.com\/finschool\/?post_type=markets&#038;p=24426"},"modified":"2026-10-21T16:53:10","modified_gmt":"2026-10-21T11:23:10","slug":"monitoring-your-portfolio","status":"publish","type":"markets","link":"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/monitoring-your-portfolio\/","title":{"rendered":"Debt Funds Part 2"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"24426\" class=\"elementor elementor-24426\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-0e14a4e elementor-section-full_width tab_container elementor-section-height-default elementor-section-height-default\" data-id=\"0e14a4e\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-73532dc\" data-id=\"73532dc\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-inner-section elementor-element elementor-element-b14a779 elementor-section-full_width elementor-section-height-default elementor-section-height-default\" data-id=\"b14a779\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-wide\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-50 elementor-inner-column elementor-element elementor-element-91c66ca chapters_list\" data-id=\"91c66ca\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-1789c66 elementor-widget elementor-widget-shortcode\" data-id=\"1789c66\" data-element_type=\"widget\" data-widget_type=\"shortcode.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<div class=\"elementor-shortcode\">\t<script>\n\t\tjQuery(document).ready(function(){\n\t\t\tjQuery(\"#post_chapters a[href*='\" + location.pathname + \"']\")\n\t\t\t\t.addClass(\"current\")\n\t\t\t\t.attr(\"aria-current\", \"page\");\n\t\t})\n\t<\/script>\n\t<div class=\"desktop_chapters\"><div id=\"post_chapters\"><div class=\"post_chapters-heading\">Chapters<\/div><ul><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/background-and-orientation\/\">Background and Orientation<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/personal-finance-math\/\">Personal Finance Math<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/money-today-vs-money-tommorrow\/\">Money Today vs Money Tommorrow<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/the-retirement-part-1\/\">The Retirement -Part 1<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/assumptions-in-retirement-planning\/\">Assumptions in Retirement Planning<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/understanding-stock-funds\/\">The Role of Mutual Funds in Modern Finance<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/concept-of-fund-and-nav\/\">Concept of Fund and NAV<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/understanding-the-performance-of-your-fund\/\">Mutual Fund Factsheet<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/the-equity-scheme\/\"> The Equity Scheme<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/equity-scheme-part-2\/\">Equity Scheme Part 2<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/debt-funds-part-1\/\">Debt Funds Part 1<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/monitoring-your-portfolio\/\">Debt Funds Part 2<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/debt-funds-part-3\/\">Debt Funds Part 3<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/debt-funds-part-4\/\">Debt Funds Part 4<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/investing-in-bonds\/\">Investing in Bonds<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/index-funds\/\">Index Funds<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/arbitrage-funds\/\">Arbitrage Funds<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/measuring-mutual-fund-returns\/\">Measuring Mutual Fund Returns<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/rolling-returns\/\">Rolling Returns<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/mutual-fund-expense-ratio\/\">Mutual Fund Expense Ratio<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/mutual-fund-benchmarking\/\">Mutual Fund Benchmarking<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/mutual-fund-beta-sd-and-sharpe-ratio\/\">Mutual Fund Beta SD and Sharpe Ratio<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/sortino-and-capture-ratios\/\">Sortino and Capture Ratios<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/how-to-analyse-equity-mutual-funds\/\">How to Analyse Equity Mutual Funds<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/how-to-analyse-debt-mutual-fund\/\">How to Analyse Debt Mutual Fund<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/mutual-fund-portfolio\/\">Mutual Fund Portfolio<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/smart-beta-funds\/\">Smart Beta Funds<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/asset-allocation\/\">Asset Allocation<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/exchange-traded-funds\/\">Exchange Traded Funds<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/basics-of-macro-economics\/\">Basics of Macro Economics<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/personal-finance-part-1\/\">Personal Finance-Part 1<\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/personal-finance-review-part-2\/\">Personal Finance Review Part 2 <\/a><\/li><li><i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i>&nbsp;&nbsp;&nbsp;<a href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/know-your-funds\/\">Know Your Funds<\/a><\/li><\/ul><\/div><\/div><div class=\"chapters_toggle\"><a href=\"#\" id=\"open_chapters\" aria-label=\"View chapters\"><span>View Chapters<\/span>&nbsp;&nbsp;&nbsp;<i class=\"fa fa-chevron-right\" aria-hidden=\"true\"><\/i><\/a><a href=\"#\" id=\"close_chapters\" style=\"display:none;\" 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    <span class=\"eael-tab-title title-after-icon\" >Slides<\/span>                            \n                                                    <\/li>\n                                            <li id=\"videos\" class=\" eael-tab-item-trigger eael-tab-nav-item\" aria-selected=\"false\" data-tab=\"3\" role=\"tab\" tabindex=\"-1\" aria-controls=\"videos-tab\" aria-expanded=\"false\">\n                            \n                                                                <i class=\"far fa-eye\"><\/i>                                                            \n                                                            <span class=\"eael-tab-title title-after-icon\" >Videos<\/span>                            \n                                                    <\/li>\n                    \n                                  <\/ul>\n            <\/div>\n            \n            <div class=\"eael-tabs-content\">\n\t\t        \n                    <div id=\"study-tab\" class=\"clearfix eael-tab-content-item active-default\" data-title-link=\"study-tab\">\n\t\t\t\t        <p><div class='white' style='background:rgb(255, 255, 255); border:solid 0px rgb(255, 255, 255); border-radius:0px; padding:0px 0px 0px 1px;'>\n<div id='text_slider' class='owl-carousel sa_owl_theme owl-pagination-true' data-slider-id='text_slider' style='visibility: visible;visibility:visible;'>\n<div id='text_slider_slide01' class='sa_hover_container' data-hash='The-Real-Mechanics-of-Debt-Funds' style='padding:4.9% 5%; margin:0px 0%; background-color:rgb(255, 255, 255); min-height:405px; '><h2 style=\"text-align: left\"><strong>12.1 <\/strong><strong><b>The Real Mechanics of Debt Funds<\/b><\/strong><\/h2>\r\n<p><img fetchpriority=\"high\" decoding=\"async\" class=\"aligncenter wp-image-77890 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds.png\" alt=\"The Real Mechanics of Debt Funds\" width=\"1058\" height=\"650\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds.png 1058w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds-300x184.png 300w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds-1024x629.png 1024w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds-768x472.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds-50x31.png 50w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds-100x61.png 100w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/The-Real-Mechanics-of-Debt-Funds-150x92.png 150w\" sizes=\"(max-width: 1058px) 100vw, 1058px\" \/><\/p>\r\n<p>Debt mutual funds do not act like fixed deposits; they operate as dynamic pricing systems. Returns stem from two underlying components:<\/p>\r\n<ul>\r\n<li><b><\/b><strong><b>Accrual Income:<\/b><\/strong>The interest income earned each day from holding fixed-income instruments, accrued and added to the Net Asset Value (NAV). A fund\u2019s Yield to Maturity (YTM) is a useful guide to this, although YTM also includes the gain or loss as each bond moves towards its face value at maturity.<\/li>\r\n<li><b><\/b><strong><b>Capital Appreciation\/Depreciation (Mark-to-Market Pricing):<\/b><\/strong>The change in the bond&#8217;s capital value as underlying market interest rates fluctuate.<\/li>\r\n<\/ul>\r\n<p><strong><b>Bond Price vs. Interest Rate Inverse Relationship<\/b><\/strong><\/p>\r\n<p><strong><b>Price of Bond = <\/b><\/strong><strong><b>\u2211<\/b><\/strong><strong><sub><b>t=1<\/b><\/sub><\/strong><strong><sup><b>n<\/b><\/sup><\/strong><strong><b>\u00a0C\/(1+r)<\/b><\/strong><strong><sup><b>t<\/b><\/sup><\/strong><strong><b>\u00a0+ F\/(1+r)<\/b><\/strong><strong><sup><b>n<\/b><\/sup><\/strong><\/p>\r\n<p>Where:<\/p>\r\n<ul>\r\n<li>C = Coupon payment<\/li>\r\n<li>F= Face value (Principal)<\/li>\r\n<li>r= Market interest rate \/ Yield to Maturity (YTM)<\/li>\r\n<li>t= Time period<\/li>\r\n<li>n = Total number of periods until maturity<\/li>\r\n<\/ul>\r\n<p>When prevailing market interest rates (r) fall, the present value of the fixed coupon payments (c) increases, pushing the bond price up. When market interest rates rise, existing fixed coupons become less attractive, reducing the bond price.<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p><\/div>\n<div id='text_slider_slide02' class='sa_hover_container' data-hash='Macaulay-Duration-vs-Modified-Duration' style='padding:4.9% 5%; margin:0px 0%; background-color:rgb(255, 255, 255); min-height:405px; '><h2 style=\"text-align: left\"><strong>12.2 <\/strong><strong><b>Macaulay Duration vs. Modified Duration<\/b><\/strong><\/h2>\r\n<p><img decoding=\"async\" class=\"aligncenter wp-image-77891 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration.png\" alt=\"Macaulay Duration vs Modified Durati\" width=\"898\" height=\"959\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration.png 898w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration-281x300.png 281w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration-768x820.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration-47x50.png 47w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration-94x100.png 94w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-vs-Modified-Duration-150x160.png 150w\" sizes=\"(max-width: 898px) 100vw, 898px\" \/><\/p>\r\n<p>While Macaulay Duration measures time, Modified Duration measures price sensitivity. For a bond that pays one coupon a year, Modified Duration =<\/p>\r\n<p><img decoding=\"async\" class=\"aligncenter wp-image-77899 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1.png\" alt=\"Macaulay Duration \" width=\"901\" height=\"480\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1.png 901w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1-300x160.png 300w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1-768x409.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1-50x27.png 50w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1-100x53.png 100w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Macaulay-Duration-Image-1-150x80.png 150w\" sizes=\"(max-width: 901px) 100vw, 901px\" \/><\/p>\r\n<p><strong><b>The Exact Mathematical Calculation<\/b><\/strong><\/p>\r\n<p>Macaulay Duration is calculated as:<\/p>\r\n<p>D<sub>mac<\/sub>\u00a0= [ \u03a3(t=1 to n) t\u00b7C \/ (1 + y)^t + n\u00b7F \/ (1 + y)^n ] \/ Current Bond Price<\/p>\r\n<p><strong><b>Worked Example:<\/b><\/strong><\/p>\r\n<p>Consider a 3-Year Bond with a Face Value of \u20b91,000, paying an 8% annual coupon (\u20b980\/year), with a Yield to Maturity (YTM) of 10%.<\/p>\r\n<p>Calculate Present Value (PV) of Cash Flows:<\/p>\r\n<ul>\r\n<li>Year 1: 80 \/ (1.10)^1 = 72.73<\/li>\r\n<li>Year 2: 80 \/ (1.10)^2 = 66.12<\/li>\r\n<li>Year 3: 1080 \/ (1.10)^3 = 811.42<\/li>\r\n<li><b><\/b><strong><b>Total Present Value (Bond Price): <\/b><\/strong>73 + 66.12 + 811.42 = \u20b9950.26<\/li>\r\n<\/ul>\r\n<p><strong><b>Calculate Time-Weighted Present Value:<\/b><\/strong><\/p>\r\n<ul>\r\n<li>Year 1: 1 \u00d7 72.73 = 72.73<\/li>\r\n<li>Year 2: 2 \u00d7 66.12 = 132.24<\/li>\r\n<li>Year 3: 3 \u00d7 811.42 = 2,434.26<\/li>\r\n<li><b><\/b><strong><b>Total Time-Weighted Value: <\/b><\/strong>73 + 132.24 + 2,434.26 = 2,639.23<\/li>\r\n<\/ul>\r\n<p><strong><b>Compute Durations:<\/b><\/strong><\/p>\r\n<ul>\r\n<li><b><\/b><strong><b>Macaulay Duration: <\/b><\/strong>2,639.23 \/ 950.26 = 2.777 \u2248 2.78 years<\/li>\r\n<li><b><\/b><strong><b>Modified Duration: <\/b><\/strong>D_mac \/ (1 + y) = 2.777 \/ 1.10 \u2248 2.52<\/li>\r\n<\/ul>\r\n<p>Interpretation<em><i>:<\/i><\/em>\u00a0A modified duration of 2.52 means that if market interest rates rise by <strong><b>1%<\/b><\/strong>, the bond price will drop by approximately <strong><b>2.52%<\/b><\/strong>.<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p><\/div>\n<div id='text_slider_slide03' class='sa_hover_container' data-hash='Case-Studies ' style='padding:4.9% 5%; margin:0px 0%; background-color:rgb(255, 255, 255); min-height:405px; '><h2 style=\"text-align: left\"><strong>12.3.<b>\u00a0Case Studies<\/b><\/strong><\/h2>\r\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-77893 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2.png\" alt=\"Case Studies (2)\" width=\"978\" height=\"917\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2.png 978w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2-300x281.png 300w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2-768x720.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2-50x47.png 50w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2-100x94.png 100w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Case-Studies-2-150x141.png 150w\" sizes=\"(max-width: 978px) 100vw, 978px\" \/><\/p>\r\n<p><strong><b>Case 1: The April 2023 Tax Reform (Section 50AA)<\/b><\/strong><\/p>\r\n<p>The Finance Act 2023 inserted Section 50AA into the Income-tax Act, 1961. It removed Long-Term Capital Gains (LTCG) treatment and indexation for \u201cspecified mutual funds\u201d, which at first meant funds investing not more than 35% in domestic equity shares.<\/p>\r\n<ul>\r\n<li><b><\/b><strong><b>Impact: <\/b><\/strong>Gains on such funds bought on or after April 1, 2023 are treated as short-term capital gains and taxed at the investor\u2019s income-tax slab rate, regardless of holding period. From April 1, 2025, the definition changed to funds investing more than 65% in debt and money-market instruments (and funds of funds investing 65% or more in such funds), so hybrid funds with 35\u201365% equity are no longer caught. The same treatment continues under the Income-tax Act, 2025, which replaced the 1961 Act from April 1, 2026. Units bought before April 1, 2023 are taxed differently: if held for more than 24 months, gains are taxed at 12.5% without indexation.<\/li>\r\n<li><b><\/b><strong><b>Strategic Shift: <\/b><\/strong>For investors in the highest (30%) tax slab, debt fund returns are now taxed much like bank fixed deposit interest: a 7% gross yield becomes about 4.8% after 30% tax and 4% cess (before any surcharge). The difference is that debt fund gains are taxed only on redemption, not every year. This has shifted some interest towards Arbitrage Funds\u00a0and Equity Savings Funds\u00a0for tax-efficient parking, although these carry their own equity-related risks.<\/li>\r\n<\/ul>\r\n<p><strong><b>Case 2: The AT1 Bond Write-Down Crisis (Yes Bank &amp; Credit Suisse)<\/b><\/strong><\/p>\r\n<p>Additional Tier-1 (AT1) bonds are perpetual debt instruments used by banks to absorb losses.<\/p>\r\n<ul>\r\n<li><b><\/b><strong><b>Event:<\/b><\/strong>In the rescue of Yes Bank (March 2020), AT1 bonds worth \u20b98,415 crore were written down to zero while shareholders kept some value. A similar write-down of about CHF 16 billion happened in the rescue of Credit Suisse (March 2023). The Bombay High Court quashed the Yes Bank write-off in January 2023, and in October 2026 the Supreme Court upheld that ruling, holding the write-off invalid.<\/li>\r\n<li><b><\/b><strong><b>Mutual Fund Risk Exposure:<\/b><\/strong>Indian schemes holding Yes Bank\u2019s AT1 bonds suffered sudden, large NAV write-downs, showing that paper categorised as \u201cbank debt\u201d can carry equity-like loss risk without equity-like upside. SEBI now caps a scheme\u2019s investment in such perpetual bonds at 10% of its NAV (5% for any single issuer) and requires them to be valued as if they mature 100 years from the date of issue.<\/li>\r\n<\/ul>\r\n<p><strong><b>Case 3: The Rate Hike Cycle Stress Test<\/b><\/strong><\/p>\r\n<p>During the 2022\u201323 rate-hiking cycle, global central banks raised rates sharply, and the RBI lifted its repo rate from 4.00% to 6.50% between May 2022 and February 2023 to curb inflation.<\/p>\r\n<p><b><\/b><strong><b>Outcome: <\/b><\/strong>Long-duration debt funds (Macaulay duration &gt; 7 years) experienced sharp short-term drawdowns. Funds managed under an Accrual Strategy\u00a0(holding short-term instruments to maturity) remained stable, while Duration Strategies\u00a0incurred capital losses due to mark-to-market revaluations.<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p><\/div>\n<div id='text_slider_slide04' class='sa_hover_container' data-hash='Strategic-Execution-Matrix-for-Debt-Fund-Allocation' style='padding:4.9% 5%; margin:0px 0%; background-color:rgb(255, 255, 255); min-height:405px; '><h2 style=\"text-align: left\"><strong>12.4. <\/strong><strong><b>Strategic Execution Matrix for Debt Fund Allocation<\/b><\/strong><\/h2>\r\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-77892 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation.png\" alt=\"Strategic Execution Matrix for Debt Fund Allocation\" width=\"1004\" height=\"837\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation.png 1004w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation-300x250.png 300w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation-768x640.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation-50x42.png 50w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation-100x83.png 100w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Strategic-Execution-Matrix-for-Debt-Fund-Allocation-150x125.png 150w\" sizes=\"(max-width: 1004px) 100vw, 1004px\" \/><\/p>\r\n<table>\r\n<tbody>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Fund Category<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p><strong><b>SEBI Mandate<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p><strong><b>Primary Risk Driver<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p><strong><b>Recommended Horizon<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p><strong><b>Optimal Portfolio Role<\/b><\/strong><\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Overnight<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>Securities maturing in 1 day<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Reinvestment Risk<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>1\u20137 Days<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>Instant Cash Parking \/ STP Source<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Liquid<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>Max. 91-day residual maturity<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Minimal Credit \/ Accrual<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>1\u20133 Months<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>Emergency Reserve \/ Liquidity<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Ultra Short Term (formerly Ultra-Short Duration)<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>3 to 6 Months<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Low Credit \/ Low Interest Rate<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>3\u20136 Months<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>Money Needed in 3\u20136 Months<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Ultra Short to Short Term (formerly Low Duration)<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>6 to 12 Months<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Moderate Credit \/ Accrual<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>6\u201312 Months<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>Park Funds for Near-Term Goals<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Short Term (formerly Short Duration)<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>1 to 3 Years<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Moderate Duration Sensitivity<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>2\u20133 Years<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>Core Stable Allocation<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Gilt Funds<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>Minimum 80% in G-Secs<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Pure Interest Rate Risk (Zero Credit)<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>5+ Years<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>Long-Term Holding; Gains When Rates Fall<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"172\">\r\n<p><strong><b>Credit Risk Funds<\/b><\/strong><\/p>\r\n<\/td>\r\n<td width=\"184\">\r\n<p>Min 65% in AA and below (excl. AA+)<\/p>\r\n<\/td>\r\n<td width=\"233\">\r\n<p>Default &amp; Downgrade Risk<\/p>\r\n<\/td>\r\n<td width=\"243\">\r\n<p>3+ Years<\/p>\r\n<\/td>\r\n<td width=\"167\">\r\n<p>High-Yield; Not Suitable for Most Retail Investors<\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>Category names follow SEBI\u2019s circular of 26 February 2026, which renamed several debt categories without changing their duration limits. The table shows the categories most used by retail investors. SEBI\u2019s full list also includes Money Market, Medium Term, Medium to Long Term, Long Term, Dynamic, Corporate Bond, Banking &amp; PSU, Floating Rate, 10-year Constant Maturity Gilt and the new Sectoral Debt funds. Chapters 13 and 14 cover the most important of these.<\/p>\r\n<p><strong><b>Advanced Bond Valuation &amp; Duration Dynamics<\/b><\/strong><\/p>\r\n<p><strong><b>The Complete Convexity Equation<\/b><\/strong><\/p>\r\n<p>While Modified Duration provides a linear approximation of price sensitivity, bond price changes are non-linear (curved). For larger changes in interest rates (\u0394y), Modified Duration alone understates price increases when rates fall and overstates price drops when rates rise.<\/p>\r\n<p>To correct this, <strong><b>Convexity (<\/b><\/strong><strong><b>)<\/b><\/strong>\u00a0measures how much duration itself changes as yields change, that is, the curvature of the price\u2013yield relationship. The complete percentage change in bond price is calculated as:<\/p>\r\n<p>\u0394P \/ P \u2248 \u2212(ModD \u00d7 \u0394y) + [ (1\/2) \u00d7 C \u00d7 (\u0394y)^2 ]<\/p>\r\n<p>Where Bond Convexity () is given by:<\/p>\r\n<p>C = [ 1 \/ (P \u00d7 (1 + y)^2) ] \u00d7 \u03a3(t=1 to n) [ t(t + 1) \u00d7 C_t \/ (1 + y)^t ]<\/p>\r\n<p>Where: C = Convexity C_t = Cash flow at time t (coupon, plus principal in the final year) P = Current bond price y = Yield per period<\/p>\r\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-77900 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship.png\" alt=\"Price Yield Relationship\" width=\"937\" height=\"353\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship.png 937w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship-300x113.png 300w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship-768x289.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship-50x19.png 50w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship-100x38.png 100w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/Price-Yield-Relationship-150x57.png 150w\" sizes=\"(max-width: 937px) 100vw, 937px\" \/><\/p>\r\n<p><b><\/b><strong><b>Practical Implication: <\/b><\/strong>In volatile rate environments, funds holding bonds with higher convexity experience lower downside risk when yields spike and higher upside potential when yields fall.<\/p>\r\n<p><strong><b>Advanced Risk Dimensions Beyond Credit &amp; Interest Rates<\/b><\/strong><\/p>\r\n<p><b><\/b><strong><b>Reinvestment Risk<\/b><\/strong><\/p>\r\n<p>Occurs when coupon cash flows or maturing principals are reinvested at prevailing market yields lower than the original YTM.<\/p>\r\n<p>Example:When the RBI cuts rates, liquid and money market funds see their yields fall quickly, because cash from maturing short-term paper (such as 91-day CPs) must be reinvested in lower-yielding instruments.<\/p>\r\n<p><b><\/b><strong><b>Liquidity Risk &amp; Bid-Ask Spreads<\/b><\/strong><\/p>\r\n<p>Secondary market trading volumes in Indian corporate debt are heavily concentrated in AAA-rated paper. Lower-rated paper (AA or A) trades at steep bid-ask spreads. During market panic, fund managers attempting to sell AA paper face fire-sale discounts, triggering sharp single-day NAV drops. Chapters 13 and 14 look at liquidity risk in detail through the Franklin Templeton case.<\/p>\r\n<p><b><\/b><strong><b>Spread Risk<\/b><\/strong><\/p>\r\n<p>Even if benchmark G-Sec rates remain constant, the yield spread between corporate bonds and government debt can widen due to deteriorating market confidence. A widening credit spread reduces the market value of corporate debt funds, even without a formal credit rating downgrade.<\/p>\r\n<p><strong><b>Modern Case Studies (2024\u20132026)<\/b><\/strong><\/p>\r\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-77901 size-full\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS.png\" alt=\"IL and FS\" width=\"1046\" height=\"266\" srcset=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS.png 1046w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS-300x76.png 300w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS-1024x260.png 1024w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS-768x195.png 768w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS-50x13.png 50w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS-100x25.png 100w, https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2022\/05\/IL-and-FS-150x38.png 150w\" sizes=\"(max-width: 1046px) 100vw, 1046px\" \/><\/p>\r\n<p><strong><b>2018 \u2013 IL&amp;FS: <\/b><\/strong>AAA-rated paper of IL&amp;FS was downgraded to default grade within weeks, showing that even top ratings can change suddenly\u00a0<\/p>\r\n<p><strong><b>2019 \u2013 DHFL: <\/b><\/strong>DHFL, a housing finance company rated AAA until early 2019, defaulted in June 2019, causing sharp markdowns across many debt schemes\u00a0<\/p>\r\n<p><strong><b>2023 \u2013 Section 50AA: <\/b><\/strong>LTCG treatment and indexation were removed for new debt fund investments\u00a0<\/p>\r\n<p><strong><b>2024\u20132026 \u2013 Passive funds and new rules: <\/b><\/strong>Target Maturity Funds, which are passive funds holding bonds that mature around a fixed date, grew as investors looked for predictable returns. SEBI\u2019s \u201cMF Lite\u201d framework eased the rules for fund houses that run only passive schemes. In February 2026, SEBI revised its scheme categories, renaming several debt categories and adding Sectoral Debt Funds. In October 2026, the Supreme Court ruled the Yes Bank AT1 write-off invalid and the RBI raised the repo rate to 5.50%.<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p><strong><b>\u00a0<\/b><\/strong><\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p>\r\n<p>&nbsp;<\/p><\/div>\n<\/div>\n<\/div>\n<script type='text\/javascript'>\n\tjQuery(document).ready(function() {\n\t\tjQuery('#text_slider').owlCarousel({\n\t\t\titems : 1,\n\t\t\tsmartSpeed : 400,\n\t\t\tautoplay : false,\n\t\t\tautoplayHoverPause : false,\n\t\t\tsmartSpeed : 400,\n\t\t\tfluidSpeed : 400,\n\t\t\tautoplaySpeed : 400,\n\t\t\tnavSpeed : 400,\n\t\t\tdotsSpeed : 400,\n\t\t\tdotsEach : 1,\n\t\t\tloop : false,\n\t\t\tnav : true,\n\t\t\tnavText : ['Previous','Next'],\n\t\t\tdots : true,\n\t\t\tresponsiveRefreshRate : 200,\n\t\t\tslideBy : 1,\n\t\t\tmergeFit : true,\n\t\t\tautoHeight : true,\n\t\t\tmouseDrag : false,\n\t\t\ttouchDrag : true\n\t\t});\n\t\tjQuery('#text_slider').css('visibility', 'visible');\n\t\tvar owl_goto = jQuery('#text_slider');\n\t\tjQuery('.text_slider_goto1').click(function(event){\n\t\t\towl_goto.trigger('to.owl.carousel', 0);\n\t\t});\n\t\tjQuery('.text_slider_goto2').click(function(event){\n\t\t\towl_goto.trigger('to.owl.carousel', 1);\n\t\t});\n\t\tjQuery('.text_slider_goto3').click(function(event){\n\t\t\towl_goto.trigger('to.owl.carousel', 2);\n\t\t});\n\t\tjQuery('.text_slider_goto4').click(function(event){\n\t\t\towl_goto.trigger('to.owl.carousel', 3);\n\t\t});\n\t\tvar resize_24098 = jQuery('.owl-carousel');\n\t\tresize_24098.on('initialized.owl.carousel', function(e) {\n\t\t\tif (typeof(Event) === 'function') {\n\t\t\t\twindow.dispatchEvent(new Event('resize'));\n\t\t\t} else {\n\t\t\t\tvar evt = window.document.createEvent('UIEvents');\n\t\t\t\tevt.initUIEvent('resize', true, false, window, 0);\n\t\t\t\twindow.dispatchEvent(evt);\n\t\t\t}\n\t\t});\n\t});\n<\/script>\n<\/p>                    <\/div>\n\t\t        \n                    <div id=\"slides-tab\" class=\"clearfix eael-tab-content-item \" data-title-link=\"slides-tab\">\n\t\t\t\t        <p><img decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2021\/10\/coming-soon-person-g8026473a8_1920-removebg-preview.png\" \/><\/p>                    <\/div>\n\t\t        \n                    <div id=\"videos-tab\" class=\"clearfix eael-tab-content-item \" data-title-link=\"videos-tab\">\n\t\t\t\t        <p><img decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/www.5paisa.com\/finschool\/wp-content\/uploads\/2021\/10\/coming-soon-person-g8026473a8_1920-removebg-preview.png\" \/><\/p>                    <\/div>\n\t\t                    <\/div>\n        <\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Study Slides Videos 12.1 Regular Checkups &nbsp; We have talked about some of the biggest mistakes investors can make\u00e2\u20ac\u201d chasing hot funds, paying too much, and not having a diversified portfolio. You could avoid all those mistakes, but if you fail to monitor and periodically adjust your portfolio, you might still have only limited success &#8230; <a title=\"Debt Funds Part 2\" class=\"read-more\" href=\"https:\/\/www.5paisa.com\/finschool\/course\/financial-planning-through-mutual-funds-course\/monitoring-your-portfolio\/\" aria-label=\"Read more about Debt Funds Part 2\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"parent":11088,"menu_order":12,"comment_status":"closed","ping_status":"closed","template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[],"class_list":["post-24426","markets","type-markets","status-publish","format-standard","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/markets\/24426","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/markets"}],"about":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/types\/markets"}],"author":[{"embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/comments?post=24426"}],"version-history":[{"count":17,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/markets\/24426\/revisions"}],"predecessor-version":[{"id":77894,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/markets\/24426\/revisions\/77894"}],"up":[{"embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/markets\/11088"}],"wp:attachment":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/media?parent=24426"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/categories?post=24426"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}