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Best Low Duration Mutual Funds

Out of all the major Mutual Fund categories in the market, perhaps the one segment which has time and time again proven its worth is the Low Duration Mutual Funds. The best low duration funds have continued to grow at roughly 5.5% YoY. Also known as short duration Mutual Funds, such schemes have continued to attract rising investment levels from retail and institutional investors.

One of the primary ways in which these funds differ from other offerings is their duration as is obvious. All those MFs which expire in 1-3 years are categorised as Low Duration Mutual Funds. Since there is an extra taxation mechanism on those investors who exit before 1 year is complete, the defaulters list is not a long one in these schemes.

Compared to Large-Cap and Mid-Cap funds, these funds are meant for those who do not have too much time to spare to be deliberate about their investments. Most individuals who invest in these vehicles are those looking to recoup their investment and profits within a 3-year time span.

There are several reasons why low duration bond funds are so popular. They are remarkably resilient even in a bullish market, offer high returns without the accompanying factor of extra risk, and have maintained their own identity despite the rise of ultra-short-term Mutual Funds.

There are several advantages that these funds have over the others. For instance, these funds are often pooled under a comparatively lower Capital Gains taxation slab because they have a very short duration and the tax exemption threshold is rarely reached. Most fund managers in India recommend their clients to invest in short term plans and test their investment temper before trying and reaching out to longer plans.

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Top 10 Low Duration Mutual Funds

Fund NameCategoryRisk1Y ReturnsRatingFund Size(in Cr)
Kotak Low Duration FundDEBTModerate8.3%5star11,678
Aditya Birla Sun Life Low DurationDEBTModerately Low8.1%5star19,972
ICICI Prudential Savings PlanDebtModerately Low8.3%4star29,895
HDFC Low DurationDEBTModerate8.5%4star25,421
Axis Treasury Advantage FundDebtModerately Low7.3%4star10,144
Invesco India Treasury Advantage FundDebtModerately Low7.0%4star2,818
SBI Magnum Low Duration FundDebtModerately Low7.0%4star16,320
BNP Paribas Low Duration FundDebtModerately Low7.8%3star380
Nippon India Low Duration FundDebtModerately Low7.6%3star8,165
IDFC Low Duration FundDebtModerately Low6.7%3star7,150
Mirae Asset Savings FundDebtModerate6.9%3star1,088
L&T Low Duration FundDebtModerate6.9%3star1,248
LIC MF Savings FundDebtModerate7.9%3star955
Tata Treasury Advantage FundDebtModerately Low7.2%3star1,785
Sundaram Low Duration FundDebtModerately Low6.2%2star433
View All Top 10 Low Duration Mutual Funds

Features of Low Duration Mutual Fund

The funds act as investment vehicles in a volatile market as the economy slows at a steady but sure pace. Given how big India’s economy has grown since liberalisation happened in 1990, it was only a matter of time before a slump hit. However, the best low duration Funds of 2019 have managed to yield significant returns to investors.

The purposes of these plans are the following –

  • Low duration funds act as excellent avenues to invest in the Indian economy and also offer the opportunity to exit a plan within 3 years if needed without the liability for any punitive action.
  • It is the chosen way individuals can earn around 7%-9% on their investments according to the available and updated data. The best low duration funds of 2019 have grown at 9% in 2017 and 2018 and the trend is likely to continue.
  • Helps fulfil the personal financial goals that many investors have. The time aspect is of advantage here and investors naturally expect sound returns on their money. Mostly, the plans are effective, although MFs are indeed subject to certain unforeseen market risks.

Taxability

All Mutual Funds are taxable provided the gains are over Rs. 1 Lakh. The tax is collected in the form of the LTCG tax. If the returns are lower than this threshold, there is no tax liability. This exemption limit is prevalent across the entire sector of Mutual Funds and is normal.

One great advantage that best low duration funds of 2019 have is that they cannot be reneged before 1 year. That prevents any extra taxation.

Besides, like other MFs, if the funds are non-indexed, the LTCG is taxable at 20%. For indexed funds, the standard rate of 10% is applicable.

Who Are These Funds Suited For?

While everyone can invest in the best short duration Mutual Funds of 2019, there are specific categories for which the plans are best suited. They are –

  • Those who are looking for excellent financing options within 1-3 years and who are willing to bet on the prevailing market headwinds.
  • Those individual and bulk investors who may not have too much idea of investing in the market economy and who wish to gain some insights on how the processes work in tandem.
  • Those investors who wish to recoup as much as possible within a limited time.

Major Advantages

The following advantages have always carved out a niche for the best Low Duration Mutual Funds.

  • The short duration of investment acts as a risk inhibitor for most investors.
  • The excellent returns which such schemes promise.
  • The evident rise in YoY returns which acts as a natural growth stimulator for such financial tools.
  • Lastly, the chance to invest directly in the nation’s economy.

Each quarter, the list of Low Duration Mutual Funds change based on their performance. Given below is a handpicked list of these schemes currently available.

Let's have a closer look

Now let us jump and check about these top 10 mutual fund schemes.

Kotak Low Duration Fund Direct Growth

Fund Performance: This fund has given 8.54% annualized returns in the last three years. In the last year, its returns were 8.27%. It has continually hit its benchmark in the DEBT segment.

Why to invest: It is one of the most remarkable DEBT mutual funds in India. This fund has constantly outperformed other similar funds, providing 8.27% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹5,000
AUM11,678Cr
1Y Returns8.3%

Aditya Birla Sun Life Low Duration Fund Direct Growth

Fund Performance: This fund has given 8.47% annualized returns in the last three years. In the last year, its returns were 8.12%. It has continually hit its benchmark in the DEBT segment.

Why to invest: It is one of the most remarkable DEBT mutual funds in India. This fund has constantly outperformed other similar funds, providing 8.12% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹100. Minimum SIP investment amount required for this scheme is ₹100.

Min Investment Amt₹100
AUM19,972Cr
1Y Returns8.1%

ICICI Prudential Savings Fund Direct Plan Growth

Fund Performance: This fund has given 8.26% annualized returns in the last three years. In the last year, its returns were 8.35%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 8.35% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹100. Minimum SIP investment amount required for this scheme is ₹100.

Min Investment Amt₹100
AUM29,895Cr
1Y Returns8.3%

HDFC Low Duration Fund Direct Plan Growth

Fund Performance: This fund has given 8.14% annualized returns in the last three years. In the last year, its returns were 8.51%. It has continually hit its benchmark in the DEBT segment.

Why to invest: It is one of the most remarkable DEBT mutual funds in India. This fund has constantly outperformed other similar funds, providing 8.51% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹5,000
AUM25,421Cr
1Y Returns8.5%

Axis Treasury Advantage Direct Fund Growth

Fund Performance: This fund has given 8.09% annualized returns in the last three years. In the last year, its returns were 7.29%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.29% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹5,000
AUM10,144Cr
1Y Returns7.3%

Invesco India Treasury Advantage Fund Direct Growth

Fund Performance: This fund has given 7.88% annualized returns in the last three years. In the last year, its returns were 6.97%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 6.97% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹1,000. Minimum SIP investment amount required for this scheme is ₹100.

Min Investment Amt₹1,000
AUM2,818Cr
1Y Returns7.0%

SBI Magnum Low Duration Fund Direct Plan Growth

Fund Performance: This fund has given 7.8% annualized returns in the last three years. In the last year, its returns were 7.02%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.02% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹5,000
AUM16,320Cr
1Y Returns7.0%

BNP Paribas Low Duration Fund Direct Growth

Fund Performance: This fund has given 7.85% annualized returns in the last three years. In the last year, its returns were 7.79%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.79% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹300.

Min Investment Amt₹5,000
AUM380Cr
1Y Returns7.8%

Nippon India Low Duration Fund Direct Growth

Fund Performance: This fund has given 7.6% annualized returns in the last three years. In the last year, its returns were 7.57%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.57% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹100.

Min Investment Amt₹500
AUM8,165Cr
1Y Returns7.6%

IDFC Low Duration Fund Direct Growth

Fund Performance: This fund has given 7.59% annualized returns in the last three years. In the last year, its returns were 6.7%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 6.7% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹100. Minimum SIP investment amount required for this scheme is ₹100.

Min Investment Amt₹100
AUM7,150Cr
1Y Returns6.7%

Mirae Asset Savings Fund Direct Plan Growth

Fund Performance: This fund has given 6.93% annualized returns in the last three years. In the last year, its returns were 6.89%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 6.89% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹5,000
AUM1,088Cr
1Y Returns6.9%

L&T Low Duration Fund Direct Growth

Fund Performance: This fund has given 6.6% annualized returns in the last three years. In the last year, its returns were 6.93%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 6.93% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹10,000. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹10,000
AUM1,248Cr
1Y Returns6.9%

LIC MF Savings Fund Direct Growth

Fund Performance: This fund has given 6.55% annualized returns in the last three years. In the last year, its returns were 7.88%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.88% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹5,000
AUM955Cr
1Y Returns7.9%

Tata Treasury Advantage Direct Plan Growth

Fund Performance: This fund has given 5.75% annualized returns in the last three years. In the last year, its returns were 7.18%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.18% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹5,000. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹5,000
AUM1,785Cr
1Y Returns7.2%

Sundaram Low Duration Fund Direct Growth

Fund Performance: This fund has given 3.89% annualized returns in the last three years. In the last year, its returns were 6.17%. It has continually hit its benchmark in the Debt segment.

Why to invest: It is one of the most remarkable Debt mutual funds in India. This fund has constantly outperformed other similar funds, providing 6.17% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹1,000. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹1,000
AUM433Cr
1Y Returns6.2%

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