Spread your risk by investing in NCDs; go for issues rated AA and above

Unlike bank FDs that are considered risk-free investments, NCDs do carry a certain amount of risk

A slew of non-convertible debenture (NCD) offerings have hit the market recently, such as Muthoot Finance, Indiabulls Consumer Finance, Mahindra Finance, Mannapuram Finance and Shriram Transport Finance. 

More firms may come out with such issues to finance their capital requirement. And there is a good chance your financial advisor may advise you to invest in these. 

“Certain well-rated NCDs are offering as high as 200 basis points premium in terms of interest rates, when compared to fixed deposits (FDs) at prevailing rates, which make them a lucrative investment option,” says Rahul Parikh, CEO of Bajaj Capital.

Since the lure of