List Of Best Mutual Funds For Short Term For 6 Months English

List Of Best Mutual Funds For Short Term For 6  Months

The below table shows a List Of The Best Mutual Funds For the Short Term For 6 Months based on AUM, NAV, and minimum SIP.

NameAUM (Cr)NAVMinimum SIP (Rs)
HDFC Short Term Debt Fund14612.3929.78100
ICICI pru nifty next 50 index fund4443.5558.39500
SBI PSU FUND1875.8433.011500
Invesco India Infrastructure Fund960.6767.5100
Invesco India PSU Equity Fund842.3767.65500

Content:

Short Term Mutual Funds Meaning

Short-term mutual funds are investment funds that primarily invest in assets with a short maturity period, typically less than three years. They aim to offer investors higher liquidity with lower risks compared to long-term investments, making them suitable for short-term financial goals.

These funds generally invest in government securities, corporate bonds, and money market instruments. The objective is to preserve capital while providing reasonable returns. Investors prefer these funds for parking surplus cash that might be needed in the near future.

Short-term mutual funds are ideal for investors who seek minimal risk exposure. They are less affected by interest rate fluctuations, which helps in maintaining a stable portfolio. The fund’s performance might offer lower returns compared to long-term funds, but they provide safety and quick access to money.

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Best Mutual Fund For Short Term For 6 Months In India

The table below shows Best Mutual Fund For Short Term For 6 Months In India based on the lowest to highest expense ratio.

NameExpense Ratio (%)Minimum SIP (Rs)
ICICI pru nifty next 50 index fund0.3500
HDFC Short Term Debt Fund0.37100
Invesco India Infrastructure Fund0.73100
Invesco India PSU Equity Fund0.93500
SBI PSU FUND0.961500

Mutual Fund For Short Term For 6 Months

The table below shows Mutual Fund For Short Term For 6 Months based on the Highest 3Y CAGR.

NameCAGR 3Y (Cr)Minimum SIP (Rs)
ICICI pru nifty next 50 index fund23.15500
HDFC Short Term Debt Fund5.9100
Invesco India Infrastructure Fund38.24100
Invesco India PSU Equity Fund41.79500
SBI PSU FUND44.821500

Best Mutual Fund For Short Term For 6 Months

The table below shows Best Mutual Fund For Short Term For 6 Months based on exit load, i.e., the fee that the AMC charges investors when they exit or redeem their fund units.

NameAMCExit Load (%)
ICICI pru nifty next 50 index fundICICI Prudential Asset Management Company Limited0
HDFC Short Term Debt FundHDFC Asset Management Company Limited0
SBI PSU FUNDSBI Funds Management Limited0.5
Invesco India Infrastructure FundInvesco Asset Management Company Pvt Ltd.1
Invesco India PSU Equity FundInvesco Asset Management Company Pvt Ltd.1

Mutual Funds For Short Term For 6 Months

The table below shows Mutual Funds For Short Term For 6 Months based on Absolute 1 Year Return and AMC.

NameAMCAbsolute Returns – 1Y (%)
SBI PSU FUNDSBI Funds Management Limited96.47
Invesco India PSU Equity FundInvesco Asset Management Company Pvt Ltd.89.02
Invesco India Infrastructure FundInvesco Asset Management Company Pvt Ltd.76.93
ICICI pru nifty next 50 index fundICICI Prudential Asset Management Company Limited64.45
HDFC Short Term Debt FundHDFC Asset Management Company Limited7.43

Who Should Invest In  Best Mutual Funds For 6 Months in the Short Term?

Investors looking for a safe parking place for their funds for a duration of six months should consider the best short-term mutual funds. These funds are designed to provide stability and relatively quick returns, making them ideal for short-term financial commitments.

Individuals with an immediate financial goal in sight, such as a forthcoming large purchase or expense, can benefit from these funds. They offer a low-risk option for earning returns on cash that would otherwise remain idle.

Short-term mutual funds are also suitable for conservative investors who wish to avoid the volatility of the stock market. These funds provide a safer alternative to keep funds liquid while still capturing some returns on investment.

How To Invest in the  Mutual Funds For Short Term For 6 Months?

To invest in mutual funds for a short term of six months, start by identifying funds that specialize in short-duration investments. Consider factors like past performance, risk profile, and management fees. It’s advisable to consult a financial advisor to match your specific financial goals.

Next, ensure that you understand the investment strategy of the fund, which should align with your risk tolerance and return expectations. Review the fund’s holdings to confirm it invests primarily in high-quality, short-term instruments like treasury bills and commercial paper.

Finally, you can invest through an online brokerage account or directly through the mutual fund’s website. Set up an investment account, complete the necessary KYC (Know Your Customer) formalities, and make your investment. Regular monitoring and readiness to adjust your investments based on market conditions are advisable.

Performance Metrics Of Mutual Funds For Short Term For 6 Months

Performance metrics for short-term mutual funds over six months include yield, expense ratio, and volatility. Investors should also consider the fund’s Sharpe ratio, which measures risk-adjusted returns, to understand how efficiently the fund delivers returns relative to its risk.

Yield is a crucial metric for short-term funds, reflecting the interest earned by the fund’s assets. A higher yield can indicate better performance, but it’s essential to balance this with the risk involved. Investors should compare yields against similar funds and benchmarks.

The expense ratio impacts net returns, especially in short-term scenarios where high fees can significantly eat into profits. Volatility indicates how much the fund’s value fluctuates. A lower volatility is typically preferred in short-term investments, as it suggests more stability.

Benefits of Investing in Best Mutual Funds For Short Term For 6 Months

The main benefits of investing in the best mutual funds for a short term of six months include higher liquidity and lower risk. These funds offer quick access to money and a safer investment option compared to stocks, making them ideal for meeting near-term financial goals.

  • Quick Cash Access: Short-term mutual funds provide the flexibility of quick withdrawals, making them perfect for investors who may need access to their funds on short notice. This feature is particularly useful for covering unexpected expenses or taking advantage of sudden investment opportunities without significant penalties.
  • Lower Risk Exposure: By investing in instruments with shorter maturities, these funds generally maintain a lower risk profile compared to long-term investments. This makes them an ideal choice for conservative investors or those nearing a financial goal who wish to minimize the chance of loss.
  • Steady Income Stream: Many short-term mutual funds aim to deliver consistent returns over periods as short as six months. They can serve as a reliable source of income through interest from bonds and dividends from other securities, which is especially appealing during volatile market conditions.
  • Flexibility in Investment: These funds often allow investors to start with lower capital, making them accessible to a wider audience. They also offer various plans like systematic investment plans (SIPs) and systematic withdrawal plans (SWPs), providing flexibility in how investors choose to contribute or withdraw funds.
  • Portfolio Diversification: Investing in short-term mutual funds can help diversify an investment portfolio, which might otherwise be heavily weighted in more volatile long-term assets. Diversification can reduce overall investment risk and smooth out returns over time, contributing to more stable financial planning.

Challenges Of Investing In Mutual Funds For Short Term For 6 Months

The main challenges of investing in mutual funds for a short term of six months include lower returns due to conservative investment strategies and the impact of fees, which can significantly eat into profits, especially given the short investment horizon.

  • Limited Growth Potential: Short-term mutual funds typically focus on low-risk, low-return investments. This conservative strategy limits the potential for high returns, making these funds less suitable for investors seeking significant growth over a six-month period.
  • Fee Impact: Even minor fees can have a disproportionate impact on net returns in short-term investments. Since the investment period is brief, fees, including management and transaction costs, can eat into the profits more significantly than in long-term investments.
  • Interest Rate Sensitivity: Short-term funds are often sensitive to interest rate changes. If rates rise, the value of existing bonds in the fund’s portfolio can decrease, potentially leading to lower returns for investors, which is a critical risk to consider.
  • Market Timing Challenges: Successfully investing in short-term funds often requires precise market timing, which can be difficult even for seasoned investors. Misjudging entry or exit points can lead to suboptimal returns and undermine the benefits of short-term investing.
  • Liquidity Concerns: While generally liquid, some short-term mutual funds might have specific trading restrictions or high redemption fees during the initial holding period. These factors can limit accessibility to funds when they are needed most.

Introduction to List Of Best Mutual Funds For Short Term For 6  Months

HDFC Short Term Debt Fund

The HDFC Short Term Debt Fund Direct Plan-Growth is a Short Duration mutual fund offering from HDFC Mutual Fund. This fund has been operational for 11 years and 4 months, with its inception on January 1, 2013.

The HDFC Short Term Debt Fund falls under the Short Duration Fund category and manages an Asset Under Management (AUM) of ₹14,612.39 crore. It has demonstrated a Compound Annual Growth Rate (CAGR) of 7.43% over the past five years. The fund has an exit load of 7.43% and maintains a low expense ratio of 0.37%. It is categorized as a ‘Moderate’ risk according to SEBI’s risk classification. The portfolio composition is primarily concentrated in Corporate Debt at 62.53%, followed by Government Securities at 32.23%. Cash & Equivalents constitute 3.14%, with Secured Debt and Certificate of Deposit making up 1.10% and 0.72% respectively. Additionally, there is a minor allocation in other assets totaling 0.28%. 

ICICI pru nifty next 50 index fund

The ICICI Prudential Nifty Next 50 Index Direct-Growth is a Large Cap Index mutual fund scheme offered by ICICI Prudential Mutual Fund. It has been available for 11 years and 4 months since its launch on January 1, 2013.

The ICICI Pru Nifty Next 50 Index Fund is categorized as an Index Fund and manages an Asset Under Management (AUM) of ₹4,443.55 crore. It has recorded a five-year Compound Annual Growth Rate (CAGR) of 64.45%. The fund has an exit load of 64.45% and an expense ratio of 0.3%. It is classified under the ‘Very High’ risk category by SEBI. The allocation shows that Equity makes up the majority of the portfolio at 99.83%, while Cash & Equivalents account for a small portion, totaling 0.17%.

SBI PSU FUND

The SBI Banking and PSU Fund Direct-Growth is a mutual fund scheme focusing on Banking and PSU investments, offered by SBI Mutual Fund. This fund has been active for 11 years and 4 months since its launch on January 1, 2013.

The SBI PSU Fund, a Thematic Fund, manages assets totaling ₹1,875.84 crore. Over the past five years, it has achieved a Compound Annual Growth Rate (CAGR) of 96.47%. The fund imposes an exit load of 96.47% and has an expense ratio of 0.96%. It is rated as a ‘Very High’ risk according to SEBI’s risk classification. The actual allocation includes 91.06% in Equity and 8.94% in Cash & Equivalents.

Invesco India Infrastructure Fund

The Invesco India Infrastructure Fund Direct-Growth is categorized as a Sectoral-Infrastructure mutual fund scheme under Invesco Mutual Fund. This fund has a history of 11 years and 4 months since it was first launched on January 1, 2013.

The Invesco India Infrastructure Fund is classified under the Sectoral Fund – Infrastructure category, with assets under management amounting to ₹960.67 crore. It has posted a Compound Annual Growth Rate (CAGR) of 76.93% over five years. The fund’s exit load is set at 76.93%, and it has an expense ratio of 0.73%. According to SEBI, it falls into the ‘Very High’ risk category. The actual allocation includes 97.21% in Equity and 2.79% in Cash & Equivalents.

Invesco India PSU equity fund

The Invesco India PSU Equity Fund Direct-Growth is categorized as a Thematic-PSU mutual fund and is managed by Invesco Mutual Fund. It has been active for 11 years and 4 months since its launch on January 1, 2013.

The INVESCO India PSU Equity Fund is part of the Thematic Fund category and oversees assets worth ₹842.37 crore. It has experienced a five-year Compound Annual Growth Rate (CAGR) of 89.02%. The fund has an exit load of 89.02% and maintains an expense ratio of 0.93%. It is classified in the ‘Very High’ risk category by SEBI. The actual allocation includes 96.95% in Equity and 3.05% in Cash & Equivalents.

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Best Mutual Funds For Short Term For 6  Months – FAQ

1. Which are the Best Mutual Funds For Short Term For 6  Months?

Best Mutual Funds For Short Term For 6  Months #1: HDFC Short Term Debt Fund
Best Mutual Funds For Short Term For 6  Months #2: ICICI pru nifty next 50 index fund
Best Mutual Funds For Short Term For 6  Months #3: SBI PSU FUND
Best Mutual Funds For Short Term For 6  Months #4: Invesco India Infrastructure Fund
Best Mutual Funds For Short Term For 6  Months #5: Invesco India PSU Equity Fund

These funds are listed based on the Highest AUM.

2. What are the Top Mutual Funds For Short Term For 6 Months?

Top mutual funds for a short term of six months include HDFC Short Term Debt Fund, which is tailored for low-risk, short-duration investments. Others like ICICI Pru Nifty Next 50 Index Fund and Invesco India Infrastructure Fund may offer higher risks and rewards. SBI PSU Fund and INVESCO India PSU Equity Fund also target specific sectors.

3. Can I Invest In Mutual Funds For Short Term For 6 Months?

Yes, you can invest in mutual funds for a short term of six months. These funds are suitable for goals requiring liquidity and low risk. However, be mindful of the potential for lower returns and the impact of any associated fees on your investment over such a short duration.

4. Is It Good To Invest In Mutual Funds For Short Term For 6 Months?

Investing in mutual funds for a short term of six months can be beneficial if you seek liquidity and minimal risk. However, the returns may be modest due to conservative investment strategies and the potential impact of fees, making it crucial to align such investments with specific financial goals.

5. How To Invest in the Mutual Funds For Short Term For 6 Months?

To invest in mutual funds for a short term of six months, start by opening an account with a brokerage like Alice Blue. Research funds that focus on short-term investments, considering their performance and fees. Complete the necessary KYC, then invest directly through the Alice Blue platform.

Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time The securities quoted are exemplary and are not recommendatory.

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