Explained: Why small investors are ditching FDs for mutual funds

Small investors are gradually ditching savings instruments like fixed deposits and other small savings schemes for mutual funds. Find out why more traditional investors are now increasing their risk appetite and putting money in mutual funds.

Many small investors in the country are ditching safer fixed deposit (FD) schemes and pouring money into mutual funds instead. The gradual move towards mutual funds comes at a time when interest rates offered on FDs and other preferred savings schemes have dipped to historic lows. People who are ditching FDs and similar bank deposit schemes hope to earn more from riskier mutual funds which offer higher returns. Read | India's equity mutual funds show first inflows after 8 months