Bond funds are funds which purchase bonds for investment. Generally, these funds are income-producing funds with the unit holder receiving interest income. They are wide-ranging from very safe investments (i.e. government bonds) to very risky investments (junk bonds). Depending on your investment preference and risk tolerance, you can choose the right type of bond unit trust for your financial. Bond funds are especially popular during the economic downturn as it is typically have higher interest than fixed deposit. However, if the investment returns of a bond funds less than the fixed deposit, you can forgot about it. No point to invest at higher risk investment and get the lower return than the lower risk investment right? This is something possible especially when the economy of a country is in good shape.