Floating rate funds a big draw as higher interest rates loom

Investors looking to shield their debt mutual fund portfolios in a rising interest rate environment are putting money into floating rate funds. This category of funds received the highest inflows within the debt mutual fund category — of ₹23,734 crore — in the past three months as investors believe the interest rate cycle is set to reverse. “We are at the fag-end of interest rate-cut cycle. We expect rates to be volatile due to moderation in