New Delhi, July 28 -- Debt mutual funds remain the preferred route for investing in bonds and debentures-and for good reason. Professional fund management, diversification and liquidity have made them the default choice for most investors.

However, investing directly in bonds, without the mutual fund wrapper, is also an option. While this route has always existed, recent regulatory and market developments have made it far more accessible than before.

To understand why, it helps to look at how corporate bonds are issued.

Most corporate bonds are issued through private placements rather than public issues. This means they are not widely marketed to retail investors at the time of issuance but are instead placed with institutional and hig...