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An analysis of performance of short duration debt funds like overnight funds, liquid funds, money market funds, ultra-short term funds and short duration funds reveals that a majority of these funds finds it difficult to beat their benchmark.
The analysis shows that 95% of the total short term funds did not beat benchmark. Similarly, not a single scheme in the ultra-short term funds category beats their benchmark.
On other hand, 30% of the money market funds outperformed their benchmark.
Let’s look at the performance summary of short term debt fund categories:
Overnight funds – (3 months performance)
Out of 35 schemed in overnight fund category, only 3 schemes managed to generate alpha by beating their benchmark. Quant Overnight Fund (0.18%), ICICI Prudential Overnight Fund (0.04%) and Axis Overnight Fund (0.03%) were the top three funds in terms of generating alpha.
Liquid funds – (3 months performance)
Of the 36 funds in this category, 17 schemes managed to beat their benchmark in 3 months period ending in March 2024. Bank of India Liquid Fund and LIC MF Liquid Fund were the top two funds that outperformed benchmark by 0.18% and 0.15%, respectively.
Money market funds ¬– (6 months performance)
Of the 23 schemes, 7 schemes in money market category outperformed their benchmark. Nippon India Money Market Fund outperformed its benchmark with an alpha of 0.22% followed by Axis Money Market Fund and ICICI Prudential Money Market Fund with outperformance of 0.19% and 0.15%, respectively.
Ultra-short duration funds – (6 months performance)
None of the schemes in ultra-short duration fund category managed to outperform. Mirae Asset Ultra Short Duration Fund, Invesco India Ultra Short Duration Fund and Aditya Birla Sun Life Savings Fund were the least underperformers in this category.
Short duration funds – (1 year performance)
Of the 23 schemes in short duration funds category, ICICI Prudential Short Term Fund is the only scheme that managed to beat its benchmark by 0.11%.
Click here to see the complete report. Outperformers marked in yellow.
