+91-22-489139098 Best Short Term Investment Options
A short term investment is something that you would want to invest for a short duration. Well, here short term doesn’t have any fix duration, but it’s ideally a financial goal, which is less than three years. So, if you are planning to invest for a short term, here are some of the best short term investment options.
One can park this fund in short term investment options, so that it can be liquidated anytime one chooses while earning a return reward too. While Investing money for a vacation, start early to create a large corpus and focus on low risk, assured return on investment and high liquidity instruments.
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Fund Selection Methodology used to find 5 funds
1. Liquid Funds
Liquid Funds invest in short-term money market products such as treasury bills, commercial papers, term deposits, etc. Liquid funds invest in securities that have a low maturity period, usually less than 91 days. Liquid funds provide easy liquidity and are less volatile than the other types of debt instruments. Also, these are a better option than traditional Bank Savings Account. In comparison to bank account, liquid funds provide 7-8 percent of annual interest.
Investors wanting to invest in liquid funds, can choose amongst the below-mentioned Best Liquid Funds:
Fund NAV Net Assets (Cr) 1 MO (%) 3 MO (%) 6 MO (%) 1 YR (%) 2024 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity Indiabulls Liquid Fund Growth ₹2,633.91
↑ 0.79 ₹193 0.4 1.4 2.9 6.2 6.6 5.55% 17D 17D PGIM India Insta Cash Fund Growth ₹354.493
↑ 0.08 ₹677 0.4 1.4 2.9 6.2 6.5 6.43% 26D 29D JM Liquid Fund Growth ₹74.2589
↑ 0.02 ₹2,524 0.4 1.4 2.8 6.1 6.4 6.07% 1M 5D 1M 8D Axis Liquid Fund Growth ₹3,033.06
↑ 0.72 ₹43,636 0.4 1.4 2.9 6.2 6.6 6.36% 1M 11D 1M 14D Tata Liquid Fund Growth ₹4,289.77
↑ 1.04 ₹33,869 0.4 1.4 2.9 6.2 6.5 6.21% 1M 7D 1M 7D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 27 Mar 26 Research Highlights & Commentary of 5 Funds showcased
Commentary Indiabulls Liquid Fund PGIM India Insta Cash Fund JM Liquid Fund Axis Liquid Fund Tata Liquid Fund Point 1 Bottom quartile AUM (₹193 Cr). Bottom quartile AUM (₹677 Cr). Lower mid AUM (₹2,524 Cr). Highest AUM (₹43,636 Cr). Upper mid AUM (₹33,869 Cr). Point 2 Established history (14+ yrs). Established history (18+ yrs). Oldest track record among peers (28 yrs). Established history (16+ yrs). Established history (21+ yrs). Point 3 Top rated. Rating: 5★ (upper mid). Rating: 5★ (lower mid). Rating: 4★ (bottom quartile). Rating: 4★ (bottom quartile). Point 4 Risk profile: Low. Risk profile: Low. Risk profile: Low. Risk profile: Low. Risk profile: Low. Point 5 1Y return: 6.23% (upper mid). 1Y return: 6.21% (bottom quartile). 1Y return: 6.09% (bottom quartile). 1Y return: 6.23% (top quartile). 1Y return: 6.22% (lower mid). Point 6 1M return: 0.41% (lower mid). 1M return: 0.40% (bottom quartile). 1M return: 0.40% (bottom quartile). 1M return: 0.41% (upper mid). 1M return: 0.42% (top quartile). Point 7 Sharpe: 2.65 (bottom quartile). Sharpe: 2.84 (lower mid). Sharpe: 2.20 (bottom quartile). Sharpe: 2.99 (top quartile). Sharpe: 2.84 (upper mid). Point 8 Information ratio: -0.47 (bottom quartile). Information ratio: 0.00 (top quartile). Information ratio: -1.44 (bottom quartile). Information ratio: 0.00 (upper mid). Information ratio: 0.00 (lower mid). Point 9 Yield to maturity (debt): 5.55% (bottom quartile). Yield to maturity (debt): 6.43% (top quartile). Yield to maturity (debt): 6.07% (bottom quartile). Yield to maturity (debt): 6.36% (upper mid). Yield to maturity (debt): 6.21% (lower mid). Point 10 Modified duration: 0.05 yrs (top quartile). Modified duration: 0.07 yrs (upper mid). Modified duration: 0.10 yrs (lower mid). Modified duration: 0.12 yrs (bottom quartile). Modified duration: 0.10 yrs (bottom quartile). Indiabulls Liquid Fund
PGIM India Insta Cash Fund
JM Liquid Fund
Axis Liquid Fund
Tata Liquid Fund
2. Ultra Short Term Funds
Ultra short duration funds invest in fixed income instruments which have a Macaulay duration between three to six months. Ultra short-term funds help investors avoid interest rate risks and also offer better returns compared to liquid debt funds. Macaulay duration measures how long it will take the scheme to recoup the investment
Here are some of the best performing ultra short term funds to invest:
Fund NAV Net Assets (Cr) 1 MO (%) 3 MO (%) 6 MO (%) 1 YR (%) 2024 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity Aditya Birla Sun Life Savings Fund Growth ₹572.749
↑ 0.41 ₹21,467 0.3 1.2 2.8 6.8 7.4 7.14% 5M 23D 6M 18D UTI Ultra Short Term Fund Growth ₹4,409.88
↑ 2.52 ₹3,946 0.3 1.2 2.6 6.1 6.6 6.76% 4M 23D 5M 19D BOI AXA Ultra Short Duration Fund Growth ₹3,284.75
↑ 1.79 ₹165 0.3 1.1 2.5 5.9 6.5 6.51% 4M 20D 4M 20D Indiabulls Ultra Short Term Fund Growth ₹2,021.64
↑ 0.84 ₹18 0.2 0.8 1.5 4.2 3.23% 1D 1D ICICI Prudential Ultra Short Term Fund Growth ₹28.9075
↑ 0.03 ₹14,897 0.3 1.3 2.8 6.5 7.1 7.11% 5M 8D 6M 14D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 27 Mar 26 Research Highlights & Commentary of 5 Funds showcased
Commentary Aditya Birla Sun Life Savings Fund UTI Ultra Short Term Fund BOI AXA Ultra Short Duration Fund Indiabulls Ultra Short Term Fund ICICI Prudential Ultra Short Term Fund Point 1 Highest AUM (₹21,467 Cr). Lower mid AUM (₹3,946 Cr). Bottom quartile AUM (₹165 Cr). Bottom quartile AUM (₹18 Cr). Upper mid AUM (₹14,897 Cr). Point 2 Oldest track record among peers (22 yrs). Established history (22+ yrs). Established history (17+ yrs). Established history (14+ yrs). Established history (14+ yrs). Point 3 Top rated. Rating: 4★ (upper mid). Rating: 4★ (lower mid). Rating: 4★ (bottom quartile). Rating: 3★ (bottom quartile). Point 4 Risk profile: Moderately Low. Risk profile: Moderately Low. Risk profile: Moderately Low. Risk profile: Moderately Low. Risk profile: Moderate. Point 5 1Y return: 6.77% (top quartile). 1Y return: 6.07% (lower mid). 1Y return: 5.89% (bottom quartile). 1Y return: 4.17% (bottom quartile). 1Y return: 6.54% (upper mid). Point 6 1M return: 0.28% (upper mid). 1M return: 0.27% (bottom quartile). 1M return: 0.27% (lower mid). 1M return: 0.24% (bottom quartile). 1M return: 0.31% (top quartile). Point 7 Sharpe: 2.39 (top quartile). Sharpe: 1.38 (lower mid). Sharpe: 0.77 (bottom quartile). Sharpe: 0.98 (bottom quartile). Sharpe: 2.28 (upper mid). Point 8 Information 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 9 Yield to maturity (debt): 7.14% (top quartile). Yield to maturity (debt): 6.76% (lower mid). Yield to maturity (debt): 6.51% (bottom quartile). Yield to maturity (debt): 3.23% (bottom quartile). Yield to maturity (debt): 7.11% (upper mid). Point 10 Modified duration: 0.48 yrs (bottom quartile). Modified duration: 0.40 yrs (lower mid). Modified duration: 0.39 yrs (upper mid). Modified duration: 0.00 yrs (top quartile). Modified duration: 0.44 yrs (bottom quartile). Aditya Birla Sun Life Savings Fund
UTI Ultra Short Term Fund
BOI AXA Ultra Short Duration Fund
Indiabulls Ultra Short Term Fund
ICICI Prudential Ultra Short Term Fund
3. 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 fund. 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.
Here are some of the best low duration funds to invest:
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 2024 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity PGIM India Low Duration Fund Growth ₹26.0337
↑ 0.01 ₹104 1.5 3.3 6.3 4.5 7.34% 6M 11D 7M 17D Baroda Pioneer Treasury Advantage Fund Growth ₹1,600.39
↑ 0.30 ₹28 0.7 1.2 3.7 -9.5 4.07% 7M 17D 8M 1D ICICI Prudential Savings Fund Growth ₹568.256
↑ 0.30 ₹26,949 1.1 2.8 6.9 7.6 7.7 7.21% 11M 1D 1Y 4M 2D UTI Treasury Advantage Fund Growth ₹3,701.11
↑ 1.10 ₹2,990 1.1 2.6 6.7 7.3 7.5 6.85% 9M 7D 11M 8D Tata Treasury Advantage Fund Growth ₹4,090.62
↑ 0.87 ₹2,572 1 2.5 6.3 7 7.2 6.85% 10M 24D 1Y 1M 4D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Sep 23 Research Highlights & Commentary of 5 Funds showcased
Commentary PGIM India Low Duration Fund Baroda Pioneer Treasury Advantage Fund ICICI Prudential Savings Fund UTI Treasury Advantage Fund Tata Treasury Advantage Fund Point 1 Bottom quartile AUM (₹104 Cr). Bottom quartile AUM (₹28 Cr). Highest AUM (₹26,949 Cr). Upper mid AUM (₹2,990 Cr). Lower mid AUM (₹2,572 Cr). Point 2 Established history (18+ yrs). Established history (16+ yrs). Oldest track record among peers (23 yrs). Established history (18+ yrs). Established history (20+ yrs). Point 3 Top rated. Rating: 5★ (upper mid). Rating: 4★ (lower mid). Rating: 4★ (bottom quartile). Rating: 4★ (bottom quartile). Point 4 Risk profile: Moderate. Risk profile: Moderately Low. Risk profile: Moderately Low. Risk profile: Moderately Low. Risk profile: Moderately Low. Point 5 1Y return: 6.30% (bottom quartile). 1Y return: 3.74% (bottom quartile). 1Y return: 6.88% (top quartile). 1Y return: 6.69% (upper mid). 1Y return: 6.33% (lower mid). Point 6 1M return: 0.47% (top quartile). 1M return: 0.21% (upper mid). 1M return: 0.17% (lower mid). 1M return: 0.13% (bottom quartile). 1M return: 0.12% (bottom quartile). Point 7 Sharpe: -1.66 (bottom quartile). Sharpe: 0.37 (bottom quartile). Sharpe: 2.48 (top quartile). Sharpe: 2.06 (upper mid). Sharpe: 1.48 (lower mid). Point 8 Information 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 9 Yield to maturity (debt): 7.34% (top quartile). Yield to maturity (debt): 4.07% (bottom quartile). Yield to maturity (debt): 7.21% (upper mid). Yield to maturity (debt): 6.85% (lower mid). Yield to maturity (debt): 6.85% (bottom quartile). Point 10 Modified duration: 0.53 yrs (top quartile). Modified duration: 0.63 yrs (upper mid). Modified duration: 0.92 yrs (bottom quartile). Modified duration: 0.77 yrs (lower mid). Modified duration: 0.90 yrs (bottom quartile). PGIM India Low Duration Fund
Baroda Pioneer Treasury Advantage Fund
ICICI Prudential Savings Fund
UTI Treasury Advantage Fund
Tata Treasury Advantage Fund
4. Money Market Fund
The money market fund invests in many markets such as commercial/treasury bills, commercial papers, certificate of deposit and other instruments specified by the Reserve Bank of India (RBI). These investments are a good option for risk-averse investors who want to earn good returns in short duration. This debt scheme will invest in money market instruments having a maturity up to one year.
Here are some of the best Money market funds to invest:
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 2024 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity Aditya Birla Sun Life Money Manager Fund Growth ₹386.298
↑ 0.32 ₹30,778 1.2 2.7 6.6 7.3 7.4 7.02% 7M 17D 7M 20D UTI Money Market Fund Growth ₹3,221.26
↑ 2.31 ₹20,320 1.2 2.7 6.7 7.4 7.5 6.03% 7M 7M ICICI Prudential Money Market Fund Growth ₹396.335
↑ 0.31 ₹32,236 1.2 2.7 6.7 7.3 7.4 6.77% 7M 21D 8M 9D Kotak Money Market Scheme Growth ₹4,690.12
↑ 3.15 ₹33,661 1.2 2.7 6.7 7.3 7.4 6.84% 7M 24D 7M 24D Nippon India Money Market Fund Growth ₹4,333.51
↑ 3.19 ₹21,876 1.2 2.7 6.7 7.3 7.4 6.89% 7M 21D 8M 8D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 27 Mar 26 Research Highlights & Commentary of 5 Funds showcased
Commentary Aditya Birla Sun Life Money Manager Fund UTI Money Market Fund ICICI Prudential Money Market Fund Kotak Money Market Scheme Nippon India Money Market Fund Point 1 Lower mid AUM (₹30,778 Cr). Bottom quartile AUM (₹20,320 Cr). Upper mid AUM (₹32,236 Cr). Highest AUM (₹33,661 Cr). Bottom quartile AUM (₹21,876 Cr). Point 2 Established history (20+ yrs). Established history (16+ yrs). Established history (20+ yrs). Oldest track record among peers (22 yrs). Established history (20+ yrs). Point 3 Top rated. Rating: 4★ (upper mid). Rating: 4★ (lower mid). Rating: 4★ (bottom quartile). Rating: 3★ (bottom quartile). Point 4 Risk profile: Low. Risk profile: Low. Risk profile: Low. Risk profile: Low. Risk profile: Low. Point 5 1Y return: 6.63% (bottom quartile). 1Y return: 6.72% (top quartile). 1Y return: 6.70% (upper mid). 1Y return: 6.67% (bottom quartile). 1Y return: 6.67% (lower mid). Point 6 1M return: 0.24% (top quartile). 1M return: 0.21% (lower mid). 1M return: 0.20% (bottom quartile). 1M return: 0.24% (upper mid). 1M return: 0.21% (bottom quartile). Point 7 Sharpe: 2.09 (bottom quartile). Sharpe: 2.45 (upper mid). Sharpe: 2.51 (top quartile). Sharpe: 2.32 (lower mid). Sharpe: 2.28 (bottom quartile). Point 8 Information 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 9 Yield to maturity (debt): 7.02% (top quartile). Yield to maturity (debt): 6.03% (bottom quartile). Yield to maturity (debt): 6.77% (bottom quartile). Yield to maturity (debt): 6.84% (lower mid). Yield to maturity (debt): 6.89% (upper mid). Point 10 Modified duration: 0.63 yrs (upper mid). Modified duration: 0.58 yrs (top quartile). Modified duration: 0.64 yrs (bottom quartile). Modified duration: 0.65 yrs (bottom quartile). Modified duration: 0.64 yrs (lower mid). Aditya Birla Sun Life Money Manager Fund
UTI Money Market Fund
ICICI Prudential Money Market Fund
Kotak Money Market Scheme
Nippon India Money Market Fund
5. Short Term Funds/Short Duration Funds
Short duration funds mainly invest in Commercial Papers, Certificate of Deposits, Money Market Instruments, etc, with a Macaulay duration of one to three years. They may provide a higher level of return than ultra-short-term and liquid funds but will be exposed to higher risks.
Here are some of the best money market funds to invest:
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 2024 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity PGIM India Short Maturity Fund Growth ₹39.3202
↓ 0.00 ₹28 1.2 3.1 6.1 4.2 7.18% 1Y 7M 28D 1Y 11M 1D ICICI Prudential Short Term Fund Growth ₹62.4304
↓ -0.05 ₹21,510 0.5 2.1 6.3 7.4 8 7.41% 2Y 8M 23D 4Y 6M 11D Nippon India Short Term Fund Growth ₹54.6362
↓ -0.04 ₹8,367 0.5 1.9 6.1 7.2 7.9 7.28% 2Y 5M 23D 3Y Aditya Birla Sun Life Short Term Opportunities Fund Growth ₹49.1853
↓ -0.03 ₹9,386 0.3 1.9 5.9 7.1 7.7 7.29% 2Y 4M 2D 2Y 11M 26D UTI Short Term Income Fund Growth ₹32.7239
↓ -0.01 ₹3,090 0.4 1.7 5.7 7 7.3 7.19% 2Y 5M 16D 3Y 5M 16D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Sep 23 Research Highlights & Commentary of 5 Funds showcased
Commentary PGIM India Short Maturity Fund ICICI Prudential Short Term Fund Nippon India Short Term Fund Aditya Birla Sun Life Short Term Opportunities Fund UTI Short Term Income Fund Point 1 Bottom quartile AUM (₹28 Cr). Highest AUM (₹21,510 Cr). Lower mid AUM (₹8,367 Cr). Upper mid AUM (₹9,386 Cr). Bottom quartile AUM (₹3,090 Cr). Point 2 Established history (23+ yrs). Oldest track record among peers (24 yrs). Established history (23+ yrs). Established history (22+ yrs). Established history (18+ yrs). Point 3 Top rated. Rating: 4★ (upper mid). Rating: 4★ (lower mid). Rating: 4★ (bottom quartile). Rating: 4★ (bottom quartile). Point 4 Risk profile: Moderate. Risk profile: Moderate. Risk profile: Moderately Low. Risk profile: Moderate. Risk profile: Moderate. Point 5 1Y return: 6.08% (lower mid). 1Y return: 6.30% (top quartile). 1Y return: 6.10% (upper mid). 1Y return: 5.88% (bottom quartile). 1Y return: 5.67% (bottom quartile). Point 6 1M return: 0.43% (top quartile). 1M return: -0.30% (upper mid). 1M return: -0.47% (bottom quartile). 1M return: -0.41% (bottom quartile). 1M return: -0.39% (lower mid). Point 7 Sharpe: -0.98 (bottom quartile). Sharpe: 1.37 (top quartile). Sharpe: 1.03 (upper mid). Sharpe: 0.91 (lower mid). Sharpe: 0.81 (bottom quartile). Point 8 Information 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 9 Yield to maturity (debt): 7.18% (bottom quartile). Yield to maturity (debt): 7.41% (top quartile). Yield to maturity (debt): 7.28% (lower mid). Yield to maturity (debt): 7.29% (upper mid). Yield to maturity (debt): 7.19% (bottom quartile). Point 10 Modified duration: 1.66 yrs (top quartile). Modified duration: 2.73 yrs (bottom quartile). Modified duration: 2.48 yrs (bottom quartile). Modified duration: 2.34 yrs (upper mid). Modified duration: 2.46 yrs (lower mid). PGIM India Short Maturity Fund
ICICI Prudential Short Term Fund
Nippon India Short Term Fund
Aditya Birla Sun Life Short Term Opportunities Fund
UTI Short Term Income Fund
6. Bank Fixed Deposits
Bank fixed deposits can be one of the best short term investment options, as these are secure investments. Also, many banks provide better interest rates on FDs, which typically range from 3% to 9.25% per annum. Investors can park their money for a minimum period of 7 days to a maximum of 10 years.
A similar option to Bank FD is Recurring deposit, which is equally effective for short term investment. If you have a habit of saving monthly, then Bank Recurring Deposits are a good option to go. They have a minimum of six months to a maximum of a decade’s tenure. Their interest rates are around 8% per annum.
7. Savings Account
A savings account is the most popular short term investment option in India. Also, it’s the safest and easiest way to access your money. If you invest your money in savings account, you can get around 4% to 7% of the return. However, interest rates may vary bank to bank. One can deposit and withdraw their money as per their convenience and requirements.
8. Fixed Maturity Plans
Fixed Maturity Plan (FMP) is offered by Mutual Funds, which invest in money market and debt instruments. These funds come up with lock-in period varying from a month up to three years. Unlike FDs, you cannot withdraw your money in FMPs before the maturity period. However, FMPs are more tax efficient than FDs, and you can also expect better returns.
Conclusion
Every Investor has their own choice of instruments with regards to their goals. In order to invest in the short term Investment plan, one should calculate the amount, risks, tenure, interest rates and liquidity that comes along with each instrument. Since you are planning a short term investment, you should make a smart choice with instruments that have a low risk. Invest Now and make your short term goals successful!
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