Index Fund Corner
Sponsored
| Scheme Name | 1-Year Return | Invest Now | Fund Category | Expense Ratio |
|---|---|---|---|---|
| Axis Nifty 50 Index Fund | +32.80% | Invest Now | Equity: Large Cap | 0.12% |
| Axis Nifty 100 Index Fund | +38.59% | Invest Now | Equity: Large Cap | 0.21% |
| Axis Nifty Next 50 Index Fund | +71.83% | Invest Now | Equity: Large Cap | 0.25% |
| Axis Nifty 500 Index Fund | — | Invest Now | Equity: Flexi Cap | 0.10% |
| Axis Nifty Midcap 50 Index Fund | +46.03% | Invest Now | Equity: Mid Cap | 0.28% |
Although they carry slightly higher risk than liquid funds, they maintain one of the lowest risk levels, making them suitable for risk-conscious investors.
What are ultra short-term mutual funds?
Ultra short-duration funds, also known as ultra short-term mutual funds, are a type of fixed-income debt scheme that focuses on investments with short maturity periods, typically ranging from three to six months. These funds are designed for those looking for a balance between enhanced returns and controlled risk.
These funds aim to deliver slightly higher returns than traditional savings instruments while ensuring relatively lower risk levels compared to longer-term debt funds. Ultra short-duration funds provide liquidity and stability by investing in short-term instruments such as treasury bills, commercial papers and certificates of deposit.
They are ideal for those seeking to park surplus funds for a brief period to earn better returns without significant exposure to market fluctuations. Ultra short-duration funds invest in a portfolio of debt instruments and money market assets for durations ranging from a week to 18 months.
Additionally, these funds also offer the advantage of earning dividends. The investing strategy of these funds includes allocating funds to debt securities and money market instruments.
Advantages of investing in ultra-short funds
Potential for Better Returns: Ultra short-duration funds aim to offer higher returns than traditional savings tools like fixed deposits and savings accounts. While they are not completely risk-free, their short duration provides for a possible balance between safety and returns.
Suitability for Short-Term Goals: Ultra short-term funds are ideal for conservative investors with a three-month to one-year investment horizon. They can be an excellent solution for people who want to achieve specific financial goals in a relatively short period.
Diversification of Portfolio: These funds frequently diversify their portfolios using a variety of debt and money market securities. Diversification reduces risk and improves the fund’s overall stability.
Lower Interest Rate Risk: These funds invest in debt products with short maturities, which reduce their exposure to interest rate fluctuations. This makes them less vulnerable to interest rate risk than long-term debt funds.
Liquidity and Flexibility: These funds provide liquidity since investors can usually redeem their units quickly. This tool is useful for those who require access to their cash on short notice or want to take advantage of market possibilities.
(Edited by : Sudarsanan Mani)