Personal Finance Myth #60

Considering government securities as risk-free is a myth | Vrid
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Government securities are risk-free

While government securities are considered low-risk, they are not entirely risk-free. There is always a minimal risk associated with any investment, including G-Secs.

The primary risk is interest rate risk, which means that the market value of your bond may fluctuate if market interest rates change. You could incur capital gains or losses if you sell your bond before maturity.

Additionally, G-Secs also come with inflation risk, which means that the yields you receive from the bonds might be lower than the inflation rate, reducing your purchasing power.

Learn more about Government Securities (G-Secs) here.

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