What makes the bigger difference when you are going for bungee jumping?

• Having 3 knots of rope on your feet?
• Having 5 knots of rope on feet?
• Institute having good security standards and a strong elastic rope that does not snap when you jump?

Of course, the most important thing you would want to ensure is that all the security protocols are in place and the rope is strong enough to hold you. You will look at going to the best institute or adventure sports company to indulge in risky adventure sports like Bungee Jumping or Sky Diving. Even if the institute is great but you are not satisfied with the security standards there, you would want to stop from indulgence instead of risking your life. RIGHT?

The additional knots to the leg might just be an additional safety feature but not the primary one for sure.

The situation is not very different with debt mutual funds.

• The credit risk in a fund does not depend on whether it is open-ended or close ended scheme. It depends on the quality of bonds in that fund.
• However, open-ended bond funds do provide you an opportunity to exit if you feel the risk. This is what many people did in Franklin Templeton funds. However, those who didn’t are stuck deep and staring at more of a close-ended situation.
• Bonds can be a good investment opportunity, however, only when chosen wisely and regularly tracked.
• Also, like you listen and follow an instructor while indulging in bungee jumping or sky diving as they are risky, you should not hesitate in seeking the advise of a professional when in doubt in mutual funds to reduce the risk.
• And yes, open-ended funds are better in some ways than close-ended funds, however, close-ended funds have a lower risk of running out of liquidity since you cannot withdraw before maturity. Thus, providing more comfort to the fund manager without the worry of intermittent redemptions !!