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Don’t be surprised and panic when your investments in capital guaranteed funds (CGFs) give you zero returns. This is increasingly becoming the norm for this group of products.
Seen as the closest alternative to the relatively secure fixed deposit (FD), CGFs are designed to safeguard the capital of investors with the promise of returns higher than FD rates.
However, given the challenging economic and stock market conditions, many of these funds have performed dismally in the last one year or so. At best, many dished out marginal returns while others matured at par value, meaning that investors have only got back their capital.
