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Best Mutual Funds for Short Term Investment

Updated on September 17, 2025 , 9461 views

Nowadays, many investors are planning to diversify their Portfolio by adding Mutual Fund schemes that cater to short and long tenure. But, where to invest? is the major confusion for most investors. Therefore, we have come up best mutual funds for short term investments. There are many Mutual Fund schemes that aim for short-term goals. But, before we move ahead, let’s understand about short-term plan and how can it benefit in a number of ways!

What Exactly is a Short Term Investing?

Short-term Investing usually refers to the investment that is made for a shorter duration, i.e., periods less than three years. You can strategically plan your short-term goals and fulfill by investing in the best short term Mutual Funds. Short-term goals like saving for a vacation, bike/car, a short course, gadget, electronic devices, purchase of ornaments, down-payments, as such can be easily targeted by these funds. Some investors simply invest to earn short-term gains, as some Debt fund offer better returns than Bank FDs.

Ideally, debt funds (also known as bond funds) are the most suited for short-term investments, and equities for long-term investing. Most bond funds like Liquid Funds, ultra-short term funds, short-term funds, Dynamic Bond Funds are ideal for short-term investments. Long-term bond funds are avoided for short-term plans as they are sensitive to interest rate changes.

Below are the best short term Mutual Funds that you can consider investing your money for short term.

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Best Mutual Funds for Short Term Investment

Liquid Funds

Liquid funds are a type of debt funds that invest your money in liquid assets for a short period of time, which typically ranges from a couple of days to a few weeks. These funds are highly liquid in nature, that means, one can quickly convert invested funds into cash. Liquid funds offer better returns than savings bank account. Where you typically earn an interest of about 4-6% p.a., liquid funds offer interest rates ranging from 7-8% p.a. Here are the Best Liquid Funds that you could invest to earn optimal returns in a shorter duration.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
BOI AXA Liquid Fund Growth ₹3,045.09
↑ 0.47
₹1,8241.43.36.97.17.45.82%1M 10D1M 10D
Axis Liquid Fund Growth ₹2,943.97
↑ 0.45
₹37,1221.43.36.977.45.9%1M 9D1M 11D
Indiabulls Liquid Fund Growth ₹2,557.04
↑ 0.42
₹3031.43.36.96.97.45.88%1M 3D1M 3D
PGIM India Insta Cash Fund Growth ₹344.205
↑ 0.06
₹5271.43.36.977.35.83%20D22D
Canara Robeco Liquid Growth ₹3,183.42
↑ 0.49
₹8,3101.43.36.977.45.82%1M 1D1M 3D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 19 Sep 25

Research Highlights & Commentary of 5 Funds showcased

CommentaryBOI AXA Liquid FundAxis Liquid FundIndiabulls Liquid Fund PGIM India Insta Cash FundCanara Robeco Liquid
Point 1Lower mid AUM (₹1,824 Cr).Highest AUM (₹37,122 Cr).Bottom quartile AUM (₹303 Cr).Bottom quartile AUM (₹527 Cr).Upper mid AUM (₹8,310 Cr).
Point 2Established history (17+ yrs).Established history (15+ yrs).Established history (13+ yrs).Oldest track record among peers (18 yrs).Established history (17+ yrs).
Point 3Rating: 3★ (bottom quartile).Rating: 4★ (lower mid).Top rated.Rating: 5★ (upper mid).Rating: 3★ (bottom quartile).
Point 4Risk profile: Low.Risk profile: Low.Risk profile: Low.Risk profile: Low.Risk profile: Low.
Point 51Y return: 6.92% (top quartile).1Y return: 6.91% (upper mid).1Y return: 6.90% (lower mid).1Y return: 6.89% (bottom quartile).1Y return: 6.88% (bottom quartile).
Point 61M return: 0.48% (upper mid).1M return: 0.47% (bottom quartile).1M return: 0.48% (bottom quartile).1M return: 0.48% (top quartile).1M return: 0.48% (lower mid).
Point 7Sharpe: 4.59 (top quartile).Sharpe: 3.41 (bottom quartile).Sharpe: 3.54 (lower mid).Sharpe: 3.57 (upper mid).Sharpe: 3.48 (bottom quartile).
Point 8Information ratio: 0.74 (top quartile).Information ratio: 0.00 (lower mid).Information ratio: -1.18 (bottom quartile).Information ratio: -0.64 (bottom quartile).Information ratio: 0.08 (upper mid).
Point 9Yield to maturity (debt): 5.82% (bottom quartile).Yield to maturity (debt): 5.90% (top quartile).Yield to maturity (debt): 5.88% (upper mid).Yield to maturity (debt): 5.83% (lower mid).Yield to maturity (debt): 5.82% (bottom quartile).
Point 10Modified duration: 0.11 yrs (bottom quartile).Modified duration: 0.11 yrs (bottom quartile).Modified duration: 0.09 yrs (lower mid).Modified duration: 0.06 yrs (top quartile).Modified duration: 0.09 yrs (upper mid).

BOI AXA Liquid Fund

  • Lower mid AUM (₹1,824 Cr).
  • Established history (17+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Low.
  • 1Y return: 6.92% (top quartile).
  • 1M return: 0.48% (upper mid).
  • Sharpe: 4.59 (top quartile).
  • Information ratio: 0.74 (top quartile).
  • Yield to maturity (debt): 5.82% (bottom quartile).
  • Modified duration: 0.11 yrs (bottom quartile).

Axis Liquid Fund

  • Highest AUM (₹37,122 Cr).
  • Established history (15+ yrs).
  • Rating: 4★ (lower mid).
  • Risk profile: Low.
  • 1Y return: 6.91% (upper mid).
  • 1M return: 0.47% (bottom quartile).
  • Sharpe: 3.41 (bottom quartile).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 5.90% (top quartile).
  • Modified duration: 0.11 yrs (bottom quartile).

Indiabulls Liquid Fund

  • Bottom quartile AUM (₹303 Cr).
  • Established history (13+ yrs).
  • Top rated.
  • Risk profile: Low.
  • 1Y return: 6.90% (lower mid).
  • 1M return: 0.48% (bottom quartile).
  • Sharpe: 3.54 (lower mid).
  • Information ratio: -1.18 (bottom quartile).
  • Yield to maturity (debt): 5.88% (upper mid).
  • Modified duration: 0.09 yrs (lower mid).

PGIM India Insta Cash Fund

  • Bottom quartile AUM (₹527 Cr).
  • Oldest track record among peers (18 yrs).
  • Rating: 5★ (upper mid).
  • Risk profile: Low.
  • 1Y return: 6.89% (bottom quartile).
  • 1M return: 0.48% (top quartile).
  • Sharpe: 3.57 (upper mid).
  • Information ratio: -0.64 (bottom quartile).
  • Yield to maturity (debt): 5.83% (lower mid).
  • Modified duration: 0.06 yrs (top quartile).

Canara Robeco Liquid

  • Upper mid AUM (₹8,310 Cr).
  • Established history (17+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Low.
  • 1Y return: 6.88% (bottom quartile).
  • 1M return: 0.48% (lower mid).
  • Sharpe: 3.48 (bottom quartile).
  • Information ratio: 0.08 (upper mid).
  • Yield to maturity (debt): 5.82% (bottom quartile).
  • Modified duration: 0.09 yrs (upper mid).

Ultra Short Term Funds

Ultra Short Term fund invest in debt instruments having residual maturities of more than 91 days and typically less than 1 year. These funds are highly suitable for investors who are willing to marginally increase the risk of investment in order to earn good returns. Also, these funds generally offer higher returns compared to liquid funds. Investors can invest in these following Best Ultra Short term funds for up to a year and achieve short-term goals.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Franklin India Ultra Short Bond Fund - Super Institutional Plan Growth ₹34.9131
↑ 0.04
₹2971.35.913.78.8 0%1Y 15D
Aditya Birla Sun Life Savings Fund Growth ₹556.548
↑ 0.06
₹21,5211.647.97.47.96.76%5M 8D6M 11D
ICICI Prudential Ultra Short Term Fund Growth ₹28.092
↑ 0.00
₹16,9801.53.87.47.17.56.66%4M 20D7M 2D
SBI Magnum Ultra Short Duration Fund Growth ₹6,056.72
↑ 0.92
₹15,5251.53.77.37.17.46.22%5M 8D6M
Invesco India Ultra Short Term Fund Growth ₹2,733.54
↑ 0.41
₹1,3301.43.67.26.97.56.35%5M 16D5M 28D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 7 Aug 22

Research Highlights & Commentary of 5 Funds showcased

CommentaryFranklin India Ultra Short Bond Fund - Super Institutional PlanAditya Birla Sun Life Savings FundICICI Prudential Ultra Short Term FundSBI Magnum Ultra Short Duration FundInvesco India Ultra Short Term Fund
Point 1Bottom quartile AUM (₹297 Cr).Highest AUM (₹21,521 Cr).Upper mid AUM (₹16,980 Cr).Lower mid AUM (₹15,525 Cr).Bottom quartile AUM (₹1,330 Cr).
Point 2Established history (17+ yrs).Established history (22+ yrs).Established history (14+ yrs).Oldest track record among peers (26 yrs).Established history (14+ yrs).
Point 3Rating: 1★ (bottom quartile).Top rated.Rating: 3★ (upper mid).Rating: 3★ (lower mid).Rating: 3★ (bottom quartile).
Point 4Risk profile: Moderate.Risk profile: Moderately Low.Risk profile: Moderate.Risk profile: Low.Risk profile: Moderate.
Point 51Y return: 13.69% (top quartile).1Y return: 7.88% (upper mid).1Y return: 7.39% (lower mid).1Y return: 7.28% (bottom quartile).1Y return: 7.23% (bottom quartile).
Point 61M return: 0.59% (top quartile).1M return: 0.48% (upper mid).1M return: 0.46% (bottom quartile).1M return: 0.46% (lower mid).1M return: 0.45% (bottom quartile).
Point 7Sharpe: 2.57 (bottom quartile).Sharpe: 3.66 (top quartile).Sharpe: 2.88 (upper mid).Sharpe: 2.74 (bottom quartile).Sharpe: 2.79 (lower mid).
Point 8Information ratio: 0.00 (top quartile).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (bottom quartile).Information ratio: 0.00 (bottom quartile).
Point 9Yield to maturity (debt): 0.00% (bottom quartile).Yield to maturity (debt): 6.76% (top quartile).Yield to maturity (debt): 6.66% (upper mid).Yield to maturity (debt): 6.22% (bottom quartile).Yield to maturity (debt): 6.35% (lower mid).
Point 10Modified duration: 0.00 yrs (top quartile).Modified duration: 0.44 yrs (lower mid).Modified duration: 0.39 yrs (upper mid).Modified duration: 0.44 yrs (bottom quartile).Modified duration: 0.46 yrs (bottom quartile).

Franklin India Ultra Short Bond Fund - Super Institutional Plan

  • Bottom quartile AUM (₹297 Cr).
  • Established history (17+ yrs).
  • Rating: 1★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 13.69% (top quartile).
  • 1M return: 0.59% (top quartile).
  • Sharpe: 2.57 (bottom quartile).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 0.00% (bottom quartile).
  • Modified duration: 0.00 yrs (top quartile).

Aditya Birla Sun Life Savings Fund

  • Highest AUM (₹21,521 Cr).
  • Established history (22+ yrs).
  • Top rated.
  • Risk profile: Moderately Low.
  • 1Y return: 7.88% (upper mid).
  • 1M return: 0.48% (upper mid).
  • Sharpe: 3.66 (top quartile).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 6.76% (top quartile).
  • Modified duration: 0.44 yrs (lower mid).

ICICI Prudential Ultra Short Term Fund

  • Upper mid AUM (₹16,980 Cr).
  • Established history (14+ yrs).
  • Rating: 3★ (upper mid).
  • Risk profile: Moderate.
  • 1Y return: 7.39% (lower mid).
  • 1M return: 0.46% (bottom quartile).
  • Sharpe: 2.88 (upper mid).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 6.66% (upper mid).
  • Modified duration: 0.39 yrs (upper mid).

SBI Magnum Ultra Short Duration Fund

  • Lower mid AUM (₹15,525 Cr).
  • Oldest track record among peers (26 yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Low.
  • 1Y return: 7.28% (bottom quartile).
  • 1M return: 0.46% (lower mid).
  • Sharpe: 2.74 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 6.22% (bottom quartile).
  • Modified duration: 0.44 yrs (bottom quartile).

Invesco India Ultra Short Term Fund

  • Bottom quartile AUM (₹1,330 Cr).
  • Established history (14+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 7.23% (bottom quartile).
  • 1M return: 0.45% (bottom quartile).
  • Sharpe: 2.79 (lower mid).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 6.35% (lower mid).
  • Modified duration: 0.46 yrs (bottom quartile).

Low Duration Funds

The scheme will invest in debt and money market securities with a Macaulay duration between six to 12 months. Low duration funds have a higher maturity duration than liquid and ultra short term funds. Risk-averse investors can invest in this scheme for a short period and earn better returns than that bank Savings Account. These funds generally offer steady and stable returns.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Sundaram Low Duration Fund Growth ₹28.8391
↑ 0.01
₹550110.211.85 4.19%5M 18D8M 1D
ICICI Prudential Savings Fund Growth ₹552.059
↑ 0.04
₹27,0761.54.287.786.84%9M 29D1Y 8M 26D
UTI Treasury Advantage Fund Growth ₹3,601.01
↑ 0.41
₹3,1251.44.17.87.47.76.69%11M 12D1Y 1M 10D
Nippon India Low Duration Fund Growth ₹3,797.65
↑ 0.43
₹10,0481.447.67.17.46.81%10M 20D1Y 1M 23D
Invesco India Treasury Advantage Fund Growth ₹3,838.93
↑ 0.63
₹1,9401.447.67.27.66.47%9M 18D10M 19D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 31 Dec 21

Research Highlights & Commentary of 5 Funds showcased

CommentarySundaram Low Duration FundICICI Prudential Savings FundUTI Treasury Advantage FundNippon India Low Duration FundInvesco India Treasury Advantage Fund
Point 1Bottom quartile AUM (₹550 Cr).Highest AUM (₹27,076 Cr).Lower mid AUM (₹3,125 Cr).Upper mid AUM (₹10,048 Cr).Bottom quartile AUM (₹1,940 Cr).
Point 2Established history (18+ yrs).Oldest track record among peers (22 yrs).Established history (18+ yrs).Established history (18+ yrs).Established history (18+ yrs).
Point 3Rating: 2★ (bottom quartile).Top rated.Rating: 4★ (upper mid).Rating: 3★ (lower mid).Rating: 3★ (bottom quartile).
Point 4Risk profile: Moderately Low.Risk profile: Moderately Low.Risk profile: Moderately Low.Risk profile: Moderately Low.Risk profile: Moderately Low.
Point 51Y return: 11.79% (top quartile).1Y return: 7.96% (upper mid).1Y return: 7.81% (lower mid).1Y return: 7.63% (bottom quartile).1Y return: 7.59% (bottom quartile).
Point 61M return: 0.28% (bottom quartile).1M return: 0.44% (bottom quartile).1M return: 0.48% (top quartile).1M return: 0.45% (lower mid).1M return: 0.45% (upper mid).
Point 7Sharpe: 0.99 (bottom quartile).Sharpe: 2.68 (top quartile).Sharpe: 2.55 (upper mid).Sharpe: 2.32 (bottom quartile).Sharpe: 2.37 (lower mid).
Point 8Information ratio: 0.00 (top quartile).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (bottom quartile).Information ratio: 0.00 (bottom quartile).
Point 9Yield to maturity (debt): 4.19% (bottom quartile).Yield to maturity (debt): 6.84% (top quartile).Yield to maturity (debt): 6.69% (lower mid).Yield to maturity (debt): 6.81% (upper mid).Yield to maturity (debt): 6.47% (bottom quartile).
Point 10Modified duration: 0.47 yrs (top quartile).Modified duration: 0.83 yrs (lower mid).Modified duration: 0.95 yrs (bottom quartile).Modified duration: 0.89 yrs (bottom quartile).Modified duration: 0.80 yrs (upper mid).

Sundaram Low Duration Fund

  • Bottom quartile AUM (₹550 Cr).
  • Established history (18+ yrs).
  • Rating: 2★ (bottom quartile).
  • Risk profile: Moderately Low.
  • 1Y return: 11.79% (top quartile).
  • 1M return: 0.28% (bottom quartile).
  • Sharpe: 0.99 (bottom quartile).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 4.19% (bottom quartile).
  • Modified duration: 0.47 yrs (top quartile).

ICICI Prudential Savings Fund

  • Highest AUM (₹27,076 Cr).
  • Oldest track record among peers (22 yrs).
  • Top rated.
  • Risk profile: Moderately Low.
  • 1Y return: 7.96% (upper mid).
  • 1M return: 0.44% (bottom quartile).
  • Sharpe: 2.68 (top quartile).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 6.84% (top quartile).
  • Modified duration: 0.83 yrs (lower mid).

UTI Treasury Advantage Fund

  • Lower mid AUM (₹3,125 Cr).
  • Established history (18+ yrs).
  • Rating: 4★ (upper mid).
  • Risk profile: Moderately Low.
  • 1Y return: 7.81% (lower mid).
  • 1M return: 0.48% (top quartile).
  • Sharpe: 2.55 (upper mid).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 6.69% (lower mid).
  • Modified duration: 0.95 yrs (bottom quartile).

Nippon India Low Duration Fund

  • Upper mid AUM (₹10,048 Cr).
  • Established history (18+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderately Low.
  • 1Y return: 7.63% (bottom quartile).
  • 1M return: 0.45% (lower mid).
  • Sharpe: 2.32 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 6.81% (upper mid).
  • Modified duration: 0.89 yrs (bottom quartile).

Invesco India Treasury Advantage Fund

  • Bottom quartile AUM (₹1,940 Cr).
  • Established history (18+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Moderately Low.
  • 1Y return: 7.59% (bottom quartile).
  • 1M return: 0.45% (upper mid).
  • Sharpe: 2.37 (lower mid).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 6.47% (bottom quartile).
  • Modified duration: 0.80 yrs (upper mid).

Short Term Funds or Short Duration Funds

Investors wanting to invest for up to 3 years can prefer investing in short-term funds. These funds invest in debt instruments & money Market instruments that include the certificate of deposits, government papers (G-secs) and commercial papers (CPs). This scheme is suitable for investors who are looking for Capital preservation, but also wish to invest for a longer period to earn good returns. Short term funds can benefit from the interest Accruals in the debt portfolio & from the tactical exposure to higher duration debt by the respective fund manager. Following are the best short term funds that investors can choose to invest.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
Sundaram Short Term Debt Fund Growth ₹36.3802
↑ 0.01
₹3620.811.412.85.3 4.52%1Y 2M 13D1Y 7M 3D
Axis Short Term Fund Growth ₹31.3752
↑ 0.01
₹12,1291.24.68.47.586.89%2Y 5M 23D3Y 2M 12D
Nippon India Short Term Fund Growth ₹53.5175
↑ 0.01
₹8,9351.14.58.27.587.04%2Y 6M 18D3Y 2M 19D
ICICI Prudential Short Term Fund Growth ₹61.029
↑ 0.02
₹22,3391.34.48.17.77.87.27%2Y 7M 10D4Y 10M 20D
SBI Short Term Debt Fund Growth ₹32.5761
↑ 0.00
₹16,3871.24.48.17.47.77.02%2Y 9M 14D3Y 5M 26D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 31 Dec 21

Research Highlights & Commentary of 5 Funds showcased

CommentarySundaram Short Term Debt FundAxis Short Term FundNippon India Short Term FundICICI Prudential Short Term FundSBI Short Term Debt Fund
Point 1Bottom quartile AUM (₹362 Cr).Lower mid AUM (₹12,129 Cr).Bottom quartile AUM (₹8,935 Cr).Highest AUM (₹22,339 Cr).Upper mid AUM (₹16,387 Cr).
Point 2Oldest track record among peers (23 yrs).Established history (15+ yrs).Established history (22+ yrs).Established history (23+ yrs).Established history (18+ yrs).
Point 3Rating: 2★ (bottom quartile).Rating: 3★ (lower mid).Top rated.Rating: 4★ (upper mid).Rating: 3★ (bottom quartile).
Point 4Risk profile: Moderately Low.Risk profile: Moderately Low.Risk profile: Moderately Low.Risk profile: Moderate.Risk profile: Moderately Low.
Point 51Y return: 12.83% (top quartile).1Y return: 8.43% (upper mid).1Y return: 8.19% (lower mid).1Y return: 8.10% (bottom quartile).1Y return: 8.07% (bottom quartile).
Point 61M return: 0.20% (bottom quartile).1M return: 0.48% (upper mid).1M return: 0.42% (bottom quartile).1M return: 0.48% (lower mid).1M return: 0.48% (top quartile).
Point 7Sharpe: 0.98 (bottom quartile).Sharpe: 1.56 (top quartile).Sharpe: 1.26 (lower mid).Sharpe: 1.43 (upper mid).Sharpe: 1.26 (bottom quartile).
Point 8Information ratio: 0.00 (top quartile).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (bottom quartile).Information ratio: 0.00 (bottom quartile).
Point 9Yield to maturity (debt): 4.52% (bottom quartile).Yield to maturity (debt): 6.89% (bottom quartile).Yield to maturity (debt): 7.04% (upper mid).Yield to maturity (debt): 7.27% (top quartile).Yield to maturity (debt): 7.02% (lower mid).
Point 10Modified duration: 1.20 yrs (top quartile).Modified duration: 2.48 yrs (upper mid).Modified duration: 2.55 yrs (lower mid).Modified duration: 2.61 yrs (bottom quartile).Modified duration: 2.79 yrs (bottom quartile).

Sundaram Short Term Debt Fund

  • Bottom quartile AUM (₹362 Cr).
  • Oldest track record among peers (23 yrs).
  • Rating: 2★ (bottom quartile).
  • Risk profile: Moderately Low.
  • 1Y return: 12.83% (top quartile).
  • 1M return: 0.20% (bottom quartile).
  • Sharpe: 0.98 (bottom quartile).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 4.52% (bottom quartile).
  • Modified duration: 1.20 yrs (top quartile).

Axis Short Term Fund

  • Lower mid AUM (₹12,129 Cr).
  • Established history (15+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderately Low.
  • 1Y return: 8.43% (upper mid).
  • 1M return: 0.48% (upper mid).
  • Sharpe: 1.56 (top quartile).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 6.89% (bottom quartile).
  • Modified duration: 2.48 yrs (upper mid).

Nippon India Short Term Fund

  • Bottom quartile AUM (₹8,935 Cr).
  • Established history (22+ yrs).
  • Top rated.
  • Risk profile: Moderately Low.
  • 1Y return: 8.19% (lower mid).
  • 1M return: 0.42% (bottom quartile).
  • Sharpe: 1.26 (lower mid).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 7.04% (upper mid).
  • Modified duration: 2.55 yrs (lower mid).

ICICI Prudential Short Term Fund

  • Highest AUM (₹22,339 Cr).
  • Established history (23+ yrs).
  • Rating: 4★ (upper mid).
  • Risk profile: Moderate.
  • 1Y return: 8.10% (bottom quartile).
  • 1M return: 0.48% (lower mid).
  • Sharpe: 1.43 (upper mid).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 7.27% (top quartile).
  • Modified duration: 2.61 yrs (bottom quartile).

SBI Short Term Debt Fund

  • Upper mid AUM (₹16,387 Cr).
  • Established history (18+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: Moderately Low.
  • 1Y return: 8.07% (bottom quartile).
  • 1M return: 0.48% (top quartile).
  • Sharpe: 1.26 (bottom quartile).
  • Information ratio: 0.00 (bottom quartile).
  • Yield to maturity (debt): 7.02% (lower mid).
  • Modified duration: 2.79 yrs (bottom quartile).

*Above is list of best Short-term debt funds are having AUM/Net Assets above 100 Crore. Sorted on Last 1 Year Return.

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Taxation of Short Term Investment Plans

As the above Mutual Fund schemes fall under the debt category, the tax implication on debt funds is computed in the following way-

1. Short Term Capital Gains

If the holding period of a debt investment is less than 36 months, then it is classified as a short-term investment and these are taxed as per individual's tax slab.

2. Long Term Capital Gains

If the holding period of debt investment is more than 36 months, then it is classified as a long-term investment and is taxed at 20% with an indexation benefit.

Capital Gains Investment Holding Gains Taxation
Short Term Capital Gains Less than 36 months As per individual's tax slab
Long Term Capital Gains More than 36 months 20% with indexation benefits
Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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