Learn about India’s best short-term mutual funds and where to invest and earn returns in a short-term investment horizon. This article covers the following:
Mutual fund schemes that have a maturity period ranging from 15 days to 91 days are classified as short-term mutual funds. The maturity period depends on the assets. This investment option is best suited for people seeking asset options with low risk. For investors on the lookout for some of the best short-term mutual funds (15 days or less) available, the liquid fund option is a great bet. Others looking at a maturity period of two to four months can choose from the ultra-short-term funds available.
Dividend option and growth option are the categories under short-term mutual funds. The tax treatment for a growth option mutual fund is the same as that of a bank fixed deposit. Investors should add the income from this fund to the overall income and then compute the taxes. Also, there is a tax-exempt option for an investor opting for a dividend option. In such cases, there is no tax on investment.
Some short-term mutual funds in India offer comparatively higher returns on investment as against bank deposits. The return rate could range between 8% and 9%, again, based on the assets in the fund portfolio. Considering the tax benefits, the return on these investments tends to be higher than the post-tax returns from other forms of investments.
The following table shows the top five short-term mutual funds based on the five-year returns. You can consider various factors like Sharpe Ratio, fund’s investment objective, and risk involved while terming a fund ‘best’.
|
Fund Name |
5-Years Returns |
|
ICICI Prudential Short Term Fund – Direct Fund – GrowthShort Duration Fund |
9.12% |
|
Kotak Bond Short Term Plan – Direct Plan – GrowthShort Duration Fund |
8.82% |
|
Franklin India Short Term Income Plan – GrowthShort Duration Fund |
8.77% |
|
DSP Short Term Fund – Direct Plan – GrowthShort Duration Fund |
8.55% |
|
Baroda Short Term Bond Fund – Plan A – GrowthShort Duration Fund |
8.48% |
|
Aditya Birla Sun Life Short Term Opportunities Fund – Regular Plan – GrowthShort Duration Fund |
8.46% |
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iv: Choose from the expert-picked funds
3yr Returns
5yr Returns
3yr Returns
5yr Returns
3yr Returns
19.5%
5yr Returns
