Interest rates could stabilize over the next 6 months. Short –term funds had a good run this year on account of RBI’s monetary policy.
There is a likelihood of a pause, and these Ultra Short-term Debt Funds schemes may not be as attractive going forward. The higher returns seen in this category may not sustain for more than 3-6 months.
We will cover the medium/long-term income funds in another post. The following table ranks the ultra short-term debt funds based on a longer term horizon. Only funds with AUM over 100 crores have been considered for this analysis.
Birla Sunlife Floating Rate Fund, JM Money Manager, Birla SL Ultra Short Term, BNP Paribas Money Plus, and Kotak Floater are the top five. These funds are clocking close to 9% this year, and couple of these might provide 10%. That’s awesome considering the performance of the equity markets. Investors can ride this wave while slowly starting to increase exposure to medium/long-term or gilt and dynamic bond funds.
| FUND | CRISIL RANK | AUM (Rs Cr) | 1mo | 3mo | 6mo | 1yr | 3yr | 5yr | EARLYGAINS RANK |
| Birla SL FRF - LTP - RP | Rank 1 | 130.17 | 0.7 | 2.3 | 4.7 | 8.8 | 7.8 | 8.2 | 1 |
| JM Money Manager Fund -SPP | Rank 3 | 753.16 | 0.8 | 2.3 | 4.6 | 8.9 | 6.8 | 7.7 | 2 |
| Birla SL Ultra Short Term -RP | Rank 1 | 265.97 | 0.7 | 2.3 | 4.5 | 8.7 | 6.5 | 7.6 | 2 |
| BNP Paribas Money Plus - RP | Rank 3 | 133.17 | 0.7 | 2.1 | 4.3 | 8.6 | 7 | 7.7 | 4 |
| Kotak Floater LTP | Rank 3 | 4031.15 | 0.7 | 2.2 | 4.6 | 8.9 | 7 | 7.7 | 5 |
| Principal NTF - Conservative | Rank 3 | 403.75 | 0.7 | 2.2 | 4.6 | 8.9 | 6.7 | 7.6 | 6 |
| Reliance Floating Rate | Rank 5 | 1218.58 | 0.7 | 2.1 | 4.5 | 8.7 | 6.8 | 7.6 | 7 |
| JM Money Manager Fund -SP | Rank 2 | 203.22 | 0.8 | 2.4 | 4.8 | 9.4 | 7.5 | 7.8 | 8 |
| Tata Floater Fund | Rank 2 | 4672.52 | 0.7 | 2.3 | 4.6 | 9 | 6.9 | 7.6 | 8 |
| Principal NT - Moderate Plan | Rank 2 | 185.29 | 0.7 | 2.2 | 4.2 | 8.6 | 6.5 | 7.4 | 10 |
| HDFC Float Rate Inc-STP RP | Rank 2 | 640.13 | 0.7 | 2.1 | 4.3 | 8.4 | 6.5 | 7.3 | 11 |
| DWS Ultra STF - RP | Rank 3 | 117.07 | 0.7 | 2.2 | 4.5 | 8.5 | 6.5 | 7.3 | 12 |
| Kotak Flexi Debt | Rank 5 | 188.42 | 0.7 | 2.1 | 4.4 | 8.2 | 6.1 | 7.1 | 13 |
| HDFC CMF-Treasury Advg | Rank 1 | 6598.17 | 0.7 | 2.1 | 4.3 | 8.4 | 6.5 | 7.2 | 14 |
| Birla SL Saving Fund - RP | Rank 3 | 575.92 | 0.7 | 2.2 | 4.5 | 8.6 | 6.5 | 7.2 | 15 |
| L&T Freedom Inc -STF -G | Rank 3 | 545.58 | 0.7 | 2.2 | 4.5 | 8.8 | 6.5 | 7.2 | 16 |
| ICICI Pru Floating RP - A | Rank 1 | 380 | 0.7 | 2 | 4.1 | 8 | 5.9 | 6.9 | 17 |
| JM Money Manager Fund -RP | Rank 3 | 288.74 | 0.8 | 2.4 | 4.9 | 9.5 | 6.7 | 7.2 | 18 |
| UTI Floating Rate -STP-RP | Rank 3 | 482.16 | 0.6 | 1.9 | 4 | 8.1 | 6.6 | 7.1 | 18 |
| Birla Sun Life Cash Manager | Rank 4 | 713.11 | 0.7 | 2.2 | 4.4 | 8.4 | 6.3 | 7 | 20 |
Source of Data: Moneycontrol.com
