Credit-risk funds posted 8.97% returns over a three-year period, making them the best-performing category within debt mutual funds as corporate fundamentals improve.
Analysts highlight that higher returns come with greater risks, including credit risk, downgrade risk and liquidity risk, which underscores the importance of portfolio quality for investors.
Investment takeaway
- Three-year return of 8.97% for credit-risk funds
- Top performer among debt fund categories
- Key risks to monitor are credit, downgrade and liquidity risks
- Focus on portfolio quality when building exposure
