When the world gets unpredictable, your money doesn’t have to follow.

A business owner recently asked:

It’s a timely question.

From geopolitical tensions and elections to inflation and global debt concerns—uncertainty is the new constant.

But uncertainty doesn't mean you stop investing. It means you shift your strategy to favour safety, liquidity, and consistency.

Here’s a curated list of the best low-risk investment options for individuals and SMB owners looking to preserve capital without locking it up.

1. Liquid Mutual Funds

What they are:

Funds that invest in high-quality money market instruments with short maturities (up to 91 days).

Why they work in volatile times:

• High liquidity (T+1 redemption)

• Lower interest rate sensitivity

• Relatively stable NAV performance

Ideal for:

• Parking short-term surplus

• Emergency funds

• Tax and compliance reserves (GST, advance tax)

2. Arbitrage Funds

What they are:

Equity-oriented funds that profit from price differences in cash and futures markets.

Why they’re low risk:

• Market-neutral strategy

• Low volatility but equity taxation (favourable if held >1 year)

• Better post-tax return than FDs in many cases

Ideal for:

• Conservative investors with a 12–18 month horizon

• Founders drawing salary/dividends and looking for short-term stability

3. Target Maturity Debt Funds (TMDs)

What they are:

Debt mutual funds that invest in G-Secs, SDLs, or AAA-rated bonds maturing on a specific date.

Why they work now:

• You know the expected return if held till maturity

• Government/PSU exposure = low credit risk

• Suitable during high interest rate periods

Ideal for:

• Parking funds for 2–5 years with visibility on outcomes

• Building fixed-income reserves without traditional FDs

4. Fixed Deposits (Corporate and Bank)

Why still relevant:

• Guaranteed returns

• Suitable for ultra-conservative investors

• Now offered by digital platforms with rate comparisons and easy tracking

What to look out for:

• Stick to highly rated corporates or banks

• Avoid FDs from NBFCs or small finance companies without clear credit ratings

Pro tip:

Use laddering—split FD amounts across maturities to maintain liquidity.

5. Sovereign Gold Bonds (SGBs)

Why they’re attractive in global instability:

• Hedge against inflation, currency volatility, and geopolitical risk

• 2.5% annual interest + tax-free capital gains if held till maturity (8 years)

Caveats:

• Not liquid in the short term

• Best used for part of a long-term portfolio

Use-case:

• 5–10% allocation for capital protection during global risk cycles

6. Overnight Funds

What they are:

Debt funds that invest in one-day maturity instruments.

Why they’re safest among mutual funds:

• Practically zero interest rate or credit risk

• Ideal for 1–7 day parking

Use-case:

• Temporary holding before deploying into other instruments

• Treasury management for business accounts
  

Bonus: Sweep-in FDs with Linked Savings Accounts

Why they matter now:

• Offer the liquidity of savings accounts

• Auto-break fixed amounts when needed

• Avoids locking full capital while earning better rates than idle savings

Ideal for:

• Business owners juggling multiple outflows

• Families managing short-term financial commitments

What to Avoid During Uncertainty

• Small-cap equity funds

• Exotic international thematic funds

• Poorly-rated corporate bonds chasing high yield

• Real estate with uncertain liquidity

TL;DR – Too Long; Didn’t Read

In times of global uncertainty, wealth preservation comes before wealth maximisation.

The goal isn't to stop investing—it’s to shift capital into vehicles that preserve optionality, reduce stress, and protect downside risk.

Because peace of mind isn’t just about higher returns.

It’s about knowing your money can move when you need it—and hold when you don’t.