New Delhi, Oct. 26 -- Most investors associate mutual funds with equities. But debt funds can also play a vital role in your portfolio if used correctly. Debt funds can be especially helpful for achieving your short- to medium-term goals. They offer better yields and tax efficiency than bank savings and deposits. With 16 debt fund categories to choose from, the key lies in picking the one that aligns with your investment goals.

When goals are a few months to a few years away, advisors often recommend investors move their funds from equity to debt to insulate the corpus from the stock market's volatility. Here is a look at some of the popular debt fund categories and how these can be used.

If parking money for a few days or weeks, consid...