The result is you have a bond maturing every year for the next ten years.
Fidelity's inventory of bonds and purchase a portfolio of bonds that meet your investment strategy. The monthly income on these investments now are, however, quite unattractive, forcing people to chase the sub-optimal monthly income plans. In the example above, only a portion of your bonds matures each year, and . Similarly, if interest rates rise after two-and-a-half years, money invested in Kisan Vikas Patra can be encashed and invested accordingly. Longer-dated, riskier ladders default to a higher number of rungs. Investors are worried and do not want to lock in their rates by investing in longer-term securities now. However, be thoughtful how you construct your ladder. Dependable income is subject to the credit risk of the issuer of the bond. If interest rates had indeed increased in a year's time you would have benefited.
Debt fund managers too are advising investors to invest in floating rate securities and liquid funds.