Top Performing Money Market Funds in 5 Years

The table below shows a list Of the Best Money Market Funds Based on AUM, NAV, and minimum SIP.

Introduction to Top Performing Money Market Funds in 5 Years

SBI Savings Fund

SBI Savings Fund Direct-Growth is a Money Market mutual fund scheme from SBI Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

SBI Savings Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹29357.76 crores. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 6%. This fund has no exit load and an expense ratio of 0.25%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 101.85% and Other at -1.85%.

Kotak Money Market Fund

Kotak Money Market Fund Direct-Growth is a Money Market mutual fund scheme from Kotak Mahindra Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

Kotak Money Market Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹28234.85 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 5.88%. This fund has no exit load and an expense ratio of 0.23%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 97.33% and Other at 2.67%.

HDFC Money Market Fund

HDFC Money Market Fund Direct Plan-Growth is a Money Market mutual fund scheme from HDFC Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

HDFC Money Market Fund Direct Plan-Growth as a short-term investment fund, manages assets valued at ₹27510.56 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 6.1%. This fund has no exit load and an expense ratio of 0.23%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 100.17% and Other at -0.17%.

Tata Money Market Fund

Tata Money Market Fund Direct-Growth is a Money Market mutual fund scheme from Tata Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

Tata Money Market Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹26884.76 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 6.18%. This fund has no exit load and an expense ratio of 0.15%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 99.13% and Other at 0.87%.

Aditya Birla SL Money Manager Fund

Aditya Birla Sun Life Money Manager Fund Direct-Growth is a Money Market mutual fund scheme from Aditya Birla Sun Life Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

Aditya Birla Sun Life Money Manager Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹26499.23 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 6.15%. This fund has no exit load and an expense ratio of 0.22%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 94.92% and Other at 5.08%.

ICICI Pru Money Market Fund

ICICI Prudential Money Market Direct-Growth is a Money Market mutual fund scheme from ICICI Prudential Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

ICICI Prudential Money Market Direct-Growth as a short-term investment fund, manages assets valued at ₹26267.60 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 5.99%. This fund has no exit load and an expense ratio of 0.21%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 96.73% and Other at 3.27%.

Nippon India Money Market Fund

Nippon India Money Market Fund Direct-Growth is a Money Market mutual fund scheme from Nippon India Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

Nippon India Money Market Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹17694.49 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 6.03%. This fund has no exit load and an expense ratio of 0.25%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 100.78% and Other at -0.78%.

UTI Money Market Fund

UTI Money Market Fund Direct-Growth is a Money Market mutual fund scheme from UTI Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

UTI Money Market Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹15066.64 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 5.98%. This fund has no exit load and an expense ratio of 0.19%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 95.14% and Other at 4.86%.

Axis Money Market Fund

Axis Money Market Fund Direct-Growth is a Money Market mutual fund scheme from Axis Mutual Fund. This fund has been in existence for 5 years and 1 month, having been launched on 26/07/2019. 

Axis Money Market Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹12947.57 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 6.08%. This fund has no exit load and an expense ratio of 0.13%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 100.1%, and Other at -0.1%.

Bandhan Money Manager Fund

Bandhan Money Manager Fund Direct-Growth is a Money Market mutual fund scheme from Bandhan Mutual Fund. This fund has been in existence for 11 years and 8 months, having been launched on 01/01/2013.

Bandhan Money Manager Fund Direct-Growth as a short-term investment fund, manages assets valued at ₹7518.29 crore. Over the past 5 years, it has achieved a Compound Annual Growth Rate (CAGR) of 5.82%. This fund has no exit load and an expense ratio of 0.1%. According to SEBI, it falls under the Low to Moderate-risk category. The fund’s asset allocation comprises No Equity, Debt at 90.26% and Other at 9.74%.

What Are Money Market Funds?

Money market funds are investment vehicles that pool funds from investors to buy short-term, high-quality debt instruments such as Treasury bills, certificates of deposit and commercial paper. They aim to provide safety and liquidity for investors’ capital.

These funds are known for their low-risk nature, offering modest returns compared to other investments. They are typically used as a place to park cash or for short-term savings goals, ensuring easy access to funds when needed.

Money market funds are managed by professional fund managers who seek to maintain a stable net asset value (NAV) and avoid significant fluctuations. They are ideal for conservative investors prioritizing capital preservation and liquidity.

Features Of Top Performing Money Market Funds in 5 Years

The main features of top-performing money market funds over five years include high credit quality, competitive yields, low expense ratios and strong liquidity. These attributes help ensure safety, reliable returns and easy access to invested capital.

• High Credit Quality: Top-performing money market funds invest in high-credit-quality instruments like Treasury bills and prime commercial paper. This minimizes default risk and enhances capital preservation, crucial for maintaining stability and reliability in returns over time.
• Competitive Yields: These funds typically offer yields that are higher than average savings accounts, reflecting their efficient management and selection of short-term, high-quality investments. Competitive yields attract investors seeking better returns while keeping their capital safe.
• Low Expense Ratios: High-performing funds keep operating costs low, which helps maximize net returns for investors. A low expense ratio ensures that more of the earned interest goes directly to investors, rather than being consumed by fund management fees.
• Strong Liquidity: Top funds provide high liquidity, allowing investors to easily access their money without significant penalties. This feature is essential for managing cash flow and ensuring that funds can be quickly withdrawn or redeployed as needed.

Best Performing Money Market Funds in 5 Years

The table below shows the Best-performing Money Market Funds Based on the highest to lowest expense ratio.

Top Performing Money Market Funds in 5 Years In India

The table below shows the Best Money Market Funds Based on the Highest 3Y CAGR.

Top Performing Money Market Funds in 5 Years List 

The table below shows Best Performing Money Market Funds In India Based on Exit Load, i.e., the fee that the AMC charges investors when they exit or redeem their fund units.

Factors To Consider When Investing In Top Performing Money Market Funds in 5 Years

The main factors to consider when investing in top-performing money market funds over five years include fund credit quality, historical performance, fees and expenses and liquidity. Evaluating these elements helps ensure that the fund meets your safety and return expectations.

• Fund Credit Quality: Assess the credit quality of the fund’s investments to ensure they are in high-quality, low-risk securities. High credit quality minimizes default risk and protects your capital, which is crucial for maintaining stability and preserving investment value.
• Historical Performance: Review the fund’s historical performance to gauge its consistency and reliability. While past performance is not a guarantee of future results, strong historical returns can indicate effective management and the fund’s ability to deliver competitive yields.
• Fees and Expenses: Examine the fund’s expense ratio and any associated fees. Lower fees contribute to higher net returns by reducing the cost of investment. It’s essential to balance cost with performance to ensure that fees do not erode your returns.
• Liquidity: Ensure the fund offers strong liquidity, allowing easy access to your funds when needed. High liquidity is important for managing cash flow and avoiding penalties or delays in accessing your money, especially in changing financial conditions.

How To Invest In Top Performing Money Market Funds in 5 Years?

To invest in top-performing money market funds over five years, start by researching fund options through the financial news, rating agencies, or investment platforms. Look for funds with a strong track record and competitive yields while maintaining low fees.

Once you’ve identified suitable funds, open an account with Alice Blue which is offering these funds. You can invest directly through their platform, ensuring you meet any minimum investment requirements or conditions.

Monitor your investments periodically to ensure they continue to perform well. Reevaluate your holdings if market conditions change or if other funds offer better performance. Adjust your portfolio as needed to stay on track with your financial goals.

Advantages Of Investing In Top Performing Money Market Funds in 5 Years

The main advantages of investing in top-performing money market funds over five years include stability, liquidity, safety, and competitive returns. These benefits make them a suitable choice for preserving capital while earning modest returns in a low-risk environment.

• Stability: Top-performing money market funds offer stability by investing in high-quality, short-term securities. This reduces the risk of significant fluctuations in value, providing a steady and predictable return, which is ideal for conservative investors seeking capital preservation.
• Liquidity: These funds provide excellent liquidity, allowing investors to access their money quickly without substantial penalties. This feature is crucial for managing short-term financial needs and ensuring that funds are readily available when required, enhancing financial flexibility.
• Safety: Money market funds typically invest in low-risk, highly-rated instruments, offering a high degree of safety. This minimizes the risk of capital loss, making them a reliable option for safeguarding investments in uncertain or volatile market conditions.
• Competitive Returns: While not as high as riskier investments, top-performing money market funds offer competitive returns compared to traditional savings accounts. This makes them an attractive option for earning a better yield on idle cash while maintaining a low-risk profile.

Risks Of Investing In Top Performing Money Market Funds in 5 Years

The main risks of investing in top-performing money market funds over five years include interest rate risk, inflation risk, credit risk, and liquidity risk. Understanding these risks helps investors make informed decisions and balance their investment strategy effectively.

• Interest Rate Risk: When interest rates rise, the value of existing money market fund securities can decline. This risk affects the fund’s yields and overall returns, potentially reducing income compared to newly issued, higher-rate instruments.
• Inflation Risk: Inflation can erode the purchasing power of the returns earned from money market funds. If the inflation rate exceeds the fund’s yield, the real value of the returns may be diminished, impacting your investment’s effectiveness in preserving wealth.
• Credit Risk: Although money market funds invest in high-quality securities, there is still some credit risk. If an issuer of the underlying securities defaults or experiences credit issues, the fund’s value could be affected, potentially leading to losses.
• Liquidity Risk: While money market funds are generally liquid, extreme market conditions or heavy redemptions can affect liquidity. In rare cases, this may lead to delays or restrictions on withdrawing funds, impacting access to your investment when needed.

Importance of Money Market Funds

Money market funds are crucial for investors seeking stability and liquidity. They provide a haven for capital, offering modest returns with minimal risk, making them ideal for preserving wealth and managing short-term cash needs.

Additionally, money market funds offer high liquidity, allowing quick access to funds without significant penalties. This feature makes them a valuable tool for managing cash flow and maintaining financial flexibility while earning a return on idle cash.

How Long to Stay Invested in Money Market Funds?

The duration to stay invested in money market funds depends on your financial goals. For short-term needs or as a cash reserve, holding them for several months or a few years is ideal, ensuring stability and liquidity.

For longer-term goals, consider reallocating to higher-return investments. Money market funds are best for capital preservation and immediate liquidity, not for long-term growth. Regularly assess your investment strategy to align with changing financial objectives.

Tax Implications of Investing in Money Market Funds

Interest earned from money market funds is typically subject to federal income tax, and in some cases, state and local taxes. This income is reported on your tax return as ordinary income, potentially impacting your overall tax liability.

However, money market funds may offer some tax advantages if they invest in municipal securities, which can be exempt from federal income tax. Always consult a tax advisor to understand specific implications based on your investments and jurisdiction.

Future of Money Market Funds

The future of money market funds may involve evolving regulations and low interest rates, which could impact returns. Investors might see changes in fund management and strategies as firms adapt to market conditions and seek higher yields.

Advancements in technology and increased financial innovation could also transform money market funds. Enhanced digital platforms and new investment products may offer improved access, lower costs and more tailored options for investors seeking safety and liquidity.

Top Performing Money Market Funds in 5 Years – FAQs  

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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.