What should I do with my credit risk fund holdings in Birla after what happened at Templeton? Mr. Nilesh Shah has assured there is nothing to worry?

Firstly, this is you money and not Nilesh Shah’s money. So don’t take decisions based on what he says. He represents the mutual fund industry and hence he has to paint a rosy picture. If a formidable name like Templeton has problems in its credit risk funds, believe me, most of the other funds are also having problems. You should take this opportunity to exit these funds well before the other AMCs either decide to take the write offs or they just suspend the funds. There is a deep problem in these credit risk funds and there is no running away from that. Most fund managers have been reckless with credit risk and unit holders are now paying the price. Please don’t go by such assurances and take a call based on your individual discretion. For example, Franklin Templeton Mutual Fund had taken large exposures to higher-yielding, lower-rated credit securities and the liquidity only worsened due to the COVID-19 pandemic. If you are worried that other funds may do the same, you are absolutely justified and you must act accordingly. In fact, top mutual fund houses, including Aditya Birla and HDFC, have held conference calls with investors but this is a problem with credit risk overall.