. . . . . . . . schemes are seen as riskier than . . . . . . . . schemes.
A. Debt, equity
B. Equity, debt
C. Both A and B
D. None of the above
Answer: Option B
Solution (By Examveda Team)
Equity schemes invest mainly in shares of companies and stock market instrumentsThese market values fluctuate frequently and are affected by market volatility, economic conditions and company performance
Therefore equity based mutual fund schemes carry higher risk
Debt schemes invest mainly in fixed income securities like bonds, government securities and treasury bills
These provide more stable returns and carry lower risk compared to equity
Hence equity schemes are seen as riskier than debt schemes
Therefore the correct answer is Option B (Equity, debt)
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Why Equity Schemes Are Riskier Than Debt Schemes
Equity schemes invest in stocks and shares of companies. Their returns depend on market performance, which can be volatile and unpredictable.
Debt schemes invest in fixed-income instruments like government bonds, corporate debentures, and treasury bills. These offer more stable returns and lower risk.