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Here are the benefits of investing in state development loans:
Fixed Income Source: State development loan securities provide half-yearly interest to the investors. Hence, investing in such debt instruments is a fixed-income source for investors.
Lesser Risk: Compared to AAA bonds, state development loans have lower risks and offer a sovereign guarantee. Add to it; such dated securities are monitored by the RBI, which adds to its overall security.
Possibility Of Higher Yields: SDLs are widely acknowledged as a safe investment that yields higher interest. However, the yield percentage sometimes declines due to certain conditions.
High Liquidity: State development loans have a higher demand from several institutional investors. As a result, it is considered one of the most liquid debt securities. For an SDL securities holder, it is one of the principal investment benefits of SDLs.
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