The table below shows the lowest expense ratio of mutual funds based on AUM, NAV, and minimum SIP.
| Name | AUM (Cr) | Minimum SIP (Rs) | NAV (Rs) |
| SBI Liquid Fund | 69299.14 | 12000.0 | 3783.74 |
| HDFC Liquid Fund | 47222.26 | 100.0 | 4749.64 |
| ICICI Pru Liquid Fund | 35428.34 | 100.0 | 357.87 |
| Nippon India Liquid Fund | 35418.6 | 100.0 | 5916.26 |
| Aditya Birla SL Liquid Fund | 29764.46 | 100.0 | 390.17 |
| Kotak Liquid Fund | 27239.36 | 100.0 | 4885.03 |
| UTI Liquid Fund | 26476.76 | 100.0 | 3962.83 |
| Axis Liquid Fund | 22169.19 | 100.0 | 2686.9 |
| ICICI Pru Asset Allocator Fund | 21437.42 | 1000.0 | 114.14 |
| Aditya Birla SL Money Manager Fund | 18375.19 | 100.0 | 341.23 |
Content:
- Introduction to Lowest Expense Ratio Mutual Funds
- What Is Expense Ratio?
- Expense Ratio Example
- How To Calculate Expense Ratio In Mutual Fund?
- Who Should Invest in Lowest Expense Ratio Mutual Funds?
- How to Invest in Lowest Expense Ratio Mutual Funds?
- Mutual Funds With Lowest Expense Ratio In India – FAQ
Introduction to Lowest Expense Ratio Mutual Funds
SBI Liquid Fund
The SBI Liquid Fund is a liquid mutual fund scheme offered by SBI Mutual Fund. It was initiated on January 1st, 2013, and has a tenure of 11 years and three months.
The SBI Liquid Fund has an exit load of 0.01% and an expense ratio of 0.19%. It carries a moderate risk level. Over the past five years, it has shown a Compound Annual Growth Rate (CAGR) of 5.24%. Furthermore, the fund manages assets worth ₹ 69,299.14 crore.
The distribution of shares indicates that 0.58% are in government securities, 0.86% in corporate debt, 19.43% in treasury bills, 45.25% in certificates of deposit, and 52.63% in commercial paper.
HDFC Liquid Fund
HDFC Liquid is a liquid mutual fund scheme offered by HDFC Mutual Fund. It has been operational for 11 years and 3 months.
The HDFC Liquid Fund imposes an exit load of 0.01% and has an expense ratio of 0.2%. It holds a moderately low-risk level. Over the past five years, it has shown a Compound Annual Growth Rate (CAGR) of 5.23%. Additionally, the fund manages assets totaling ₹ 47,222.26 crore.
The allocation percentages for different types of investments are as follows: 4.68% in corporate debt, 18.34% in treasury bills, 30.02% in certificates of deposit, and 60.22% in commercial paper.
ICICI Pru Liquid Fund
ICICI Prudential Liquid Fund is a liquid mutual fund scheme provided by ICICI Prudential Mutual Fund. This fund has been operational for 11 years and three months.
The ICICI Pru Liquid Fund imposes an exit load of 0.01% and has an expense ratio of 0.2%. It carries a moderate risk level. Over the past five years, it has demonstrated a Compound Annual Growth Rate (CAGR) of 5.28%. Additionally, the fund manages assets totaling ₹ 35,428.34 crore.
The distribution of shares shows that 0.47% are in corporate debt, 0.78% in government securities, 21.16% in treasury bills, 42.24% in certificates of deposit, and 55.18% in commercial paper.
SBI Nifty50 Equal Weight Index Fund
The SBI Nifty50 Equal Weight Index Fund imposes an exit load of 0.25% and has an expense ratio of 0.0%. It carries a very high risk level. Additionally, the fund manages assets totaling ₹ 952.31 crore. 100% of funds are invested in equities.
Bajaj Finserv Large and Mid Cap Fund
The objective is to achieve long-term capital growth by investing in a diverse range of equity and equity-related securities, primarily in large and mid-cap stocks across different sectors. Additionally, the fund manager may explore opportunities in other equity-related securities.
The Bajaj Finserv Large and Mid Cap Fund has an exit load of 1.0% and an expense ratio of 0.0%. It has a very high risk level. Additionally, the fund manages assets totaling ₹ 672.72 crore. 100% of funds are invested in cash and equivalents.
UTI Nifty 50 Index Fund
The UTI Nifty 50 Index Fund is a large-cap index mutual fund scheme offered by UTI Mutual Fund. This fund has been operational for 11 years and three months.
The UTI Nifty 50 Index Fund imposes no exit load and has an expense ratio of 0.21%. It carries a very high risk level. Despite this, it has shown a robust Compound Annual Growth Rate (CAGR) of 15.21% over the past five years. Additionally, the fund manages assets totaling ₹ 15,648.55 crore. 100% of funds are invested in equities.
HDFC Index Fund-NIFTY 50 Plan
The HDFC Index Fund Nifty 50 Plan is a large-cap index mutual fund scheme provided by HDFC Mutual Fund. This fund has been operational for 11 years and 3 months.
The HDFC Index Fund-NIFTY 50 Plan imposes an exit load of 0.25% and has an expense ratio of 0.2%. It carries a very high risk level. Despite this, it has demonstrated a strong Compound Annual Growth Rate (CAGR) of 15.12% over the past 5 years. Additionally, the fund manages assets totaling ₹ 12,613.86 crore. 100% of funds are invested in equities.
ICICI Pru Asset Allocator Fund
The ICICI Prudential Asset Allocator Fund (FOF) is a hybrid fund of funds (FoF) mutual fund scheme offered by ICICI Prudential Mutual Fund. This fund has been operational for 11 years and 3 months.
The ICICI Pru Asset Allocator Fund imposes an exit load of 1.0% and has an expense ratio of 0.1%. It carries a high-risk level. Nonetheless, it has shown strong performance over the past 5 years, with a Compound Annual Growth Rate (CAGR) of 15.1%. Additionally, the fund manages assets totaling ₹ 21,437.42 crore. 100% of funds are invested in mutual funds.
Tata Money Market Fund
The Tata Money Market Fund is a mutual fund scheme provided by Tata Mutual Fund. This fund has been operational for 11 years and three months.
The Tata Money Market Fund doesn’t have an exit load and has an expense ratio of 0.16%. It carries a moderately low-risk level. Over the past five years, it has demonstrated a Compound Annual Growth Rate (CAGR) of 6.25%. Additionally, the fund manages assets totaling ₹ 14,015.19 crore.
The allocation percentages for different types of investments are as follows: 2.27% in government securities, 14.39% in treasury bills, 36.69% in commercial paper, and 58.66% in certificates of deposit.
UTI Money Market Fund
The UTI Money Market Fund is a mutual fund scheme offered by UTI Mutual Fund. This fund has been operational for 11 years and three months.
The UTI Money Market Fund doesn’t impose an exit load and has an expense ratio of 0.19%. It carries a moderate risk level. Over the past five years, it has shown a Compound Annual Growth Rate (CAGR) of 6.06%. Additionally, the fund manages assets totaling ₹ 13,070.27 crore.
The allocation percentages for different types of investments are as follows: 1.74% in government securities, 14.11% in treasury bills, 27.94% in commercial paper, and 62.96% in certificates of deposit.
What Is Expense Ratio?
The expense ratio measures the operating expenses of a mutual fund, exchange-traded fund (ETF), or other investment vehicle. It is expressed as a percentage of the fund’s average net assets and includes management fees, administrative costs, and other expenses incurred by the fund over a specific period.
Expense Ratio Example
For example, if a mutual fund has total annual expenses of ₹1,500 and the average assets under management (AUM) during the year is ₹100,000, then the expense ratio would be calculated as (₹1,500 / ₹100,000) * 100 = 1.5%. This indicates that 1.5% of the fund’s assets are used to cover expenses.
How To Calculate Expense Ratio In Mutual Fund?
To calculate a mutual fund’s expense ratio, divide the fund’s total annual expenses by its average assets under management (AUM) during the same period. Multiply the result by 100 to express it as a percentage. The formula is Expense Ratio = (Total Annual Expenses / Average AUM) * 100.
Who Should Invest in Lowest Expense Ratio Mutual Funds?
Investors seeking to optimize returns and minimize costs should consider investing in mutual funds with the lowest expense ratios. These funds are desirable for long-term investors aiming to maximize their investment gains, as lower expenses can result in higher net returns over time, especially when compounded.
How to Invest in Lowest Expense Ratio Mutual Funds?
To invest in mutual funds with the lowest expense ratios, start by researching them using financial websites or platforms. Evaluate the fund’s performance, investment strategy, and fees. Once decided, open an account with a brokerage or fund provider, complete the necessary paperwork, and invest in the chosen fund.
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Mutual Funds With Lowest Expense Ratio In India – FAQ
These are the top 5 Mutual Funds With the Lowest Expense Ratio based on 5-year CAGR.
- Motilal Oswal Nasdaq 100 FOF
- Franklin India Focused Equity Fund
- DSP US Flexible Equity Fund
- ICICI Pru US Bluechip Equity Fund
- PGIM India Global Equity Opp Fund.
A good expense ratio for a mutual fund is typically below 1%. However, it can vary depending on the fund’s investment strategy, asset class, and management style. Lower expense ratios are generally preferred as they result in higher net returns for investors over the long term.
To invest in mutual funds with the lowest expense ratios, research funds with low expenses analyze their performance and investment strategy. Open an account with a brokerage or fund provider, complete the necessary paperwork, and invest in the chosen fund.
Investing in mutual funds with the lowest expense ratios can be beneficial, as they typically result in higher net returns for investors over time. Lower expenses mean investors retain more of the fund’s returns. However, other factors, such as performance and investment strategy, should also be considered before investing.
Although the expense ratio is an annual fee, it is not levied once yearly. Instead, it is discreetly subtracted daily from the fund’s net asset value (NAV).
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