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Best Mutual Funds for Investors with a Low-risk Appetite

Highlights

  • Have a low investment risk profile? Invest in top-performing liquid funds, banking & PSU funds
  • The list of such funds is shown here along with their rating

If you think that mutual funds are meant for only aggressive investors, you are in a myth. There are tons of mutual funds that can serve the purpose of individuals having an aversion to greater risks. Yes, these are debt funds that provide a stability in terms of income flow to the investors. Debt funds can be available in several categories – short duration, long duration, bond funds, money-market, liquid, etc. These funds invest predominantly in bonds, debentures and money-market instruments to provide stable returns. Without much ado, let’s check out the best mutual funds for investors with a low-risk appetite

List of Best Liquid Funds to Invest in

Liquid funds invest in liquid instruments such as commercial paper, certificates of deposits and others having a shorter maturity period of 3-6 months. The list of top-performing liquid funds is shown in the table below. Take a look.

Liquid FundsRatingNet Asset Value (NAV)1-year Return3-year Return5-year Return10-year ReturnMinimum Investment Needed (In ₹)
Axis Liquid Fund5 StarGrowth - ₹2,108.3503

Dividend Weekly - ₹1,002.5511
7.49%7.1357.64%-500
ICICI Prudential Liquid Fund3 StarGrowth - ₹281.175

Dividend Yearly - ₹106.0729
7.42%7.07%7.61%7.85%100
Baroda Liquid Fund5 StarGrowth - ₹2,183.1192

Dividend Weekly - ₹1,000.5803
7.46%7.12%7.66%7.84%5000
Reliance Liquid Fund5 StarGrowth - ₹4,636.6225

Dividend Weekly - ₹1,531.7778
7.55%7.13%7.64%7.84%100
HDFC Liquid Fund3 StarGrowth - ₹3,736.3402

Dividend Weekly - ₹1,031.4857
7.33%6.96%7.54%7.7455000
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Best Corporate Bond Funds to Invest in

Corporate bond funds by name suggests that they invest predominantly in bonds issued by companies. Here’s a list of top performers in the said category.

Corporate Bond FundsRatingNet Asset Value (NAV)1-year Return3-year Return5-year Return10-year ReturnMinimum Investment Needed (In ₹)
Aditya Birla Sun Life Corporate Bond Fund4 StarGrowth - ₹74.1018

Dividend Monthly - ₹11.7413
10.27%8.12%8.81%8.38%100
HDFC Corporate Bond Fund4 StarGrowth - ₹21.6252

Dividend Quarterly - ₹10.4145
10.99%8.30%8.91%-5000
ICICI Prudential Corporate Bond Fund3 StarGrowth - ₹19.6952

Dividend Weekly - ₹10.3167
9.36%7.68%8.33%-5000
Reliance Prime Debt Fund4 StarGrowth - ₹39.8776

Dividend Weekly - ₹17.1179
7.79%7.31%7.98%8.00%1000
Axis Corporate Debt Fund3 StarGrowth - ₹11.3288

Dividend Weekly - ₹9.8474
5.97%---5000

Best Short Duration Funds to Invest in

These funds are open-ended debt schemes that invest in instruments with a maturity period of 1-3 years.

Short Duration Funds FundsRatingNet Asset Value (NAV)1-year Return3-year Return5-year Return10-year ReturnMinimum Investment Needed (In ₹)
HDFC Short Term Debt Fund5 StarGrowth - ₹21.2679

Dividend Fortnightly - ₹10.2595
9.29%7.78%8.41%-5000
Franklin India Short Term Income Plan5 StarGrowth - ₹4,054.9528

Dividend Weekly - ₹1,072.8253
8.80%8.74%8.89%8.76%5000
Baroda Short Term Bond Fund5 StarGrowth - ₹20.4743

Dividend Quarterly - ₹10.3785
9.11%8.22%8.56%-5000
ICICI Prudential Short Term Fund3 StarGrowth - ₹39.8179

Dividend Monthly - ₹12.2595
9.09%7.55%8.44%7.98%5000
Axis Short Term Fund4 Star9.36%7.52%8.14%-5000

Best Banking & PSU Debt Funds You Can Choose from

These funds invest in bonds and other debt instruments issued by banks and public sector undertakings (PSUs). Here’s a list of top-performing funds in this category. 

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Banking & PSU Debt FundsRatingNet Asset Value (NAV)1-year Return3-year Return5-year Return10-year ReturnMinimum Investment Needed (In ₹)
Aditya Birla Sun Life Banking & PSU Debt Fund4 StarGrowth - ₹247.8973

Dividend Quarterly - ₹105.7403
10.71%8.19%9.20%8.86%1000
DSP Banking & PSU Debt Fund3 StarGrowth - ₹16.2523

Dividend Weekly - ₹10.1916
9.87%7.63%8.41%-500
ICICI Prudential Banking & PSU Debt Fund3 StarGrowth - ₹22.069

Dividend Weekly - ₹10.2652
9.67%7.98%8.82%-5000
Axis Banking & PSU Debt Fund5 StarGrowth - ₹1,798.2064

Dividend Weekly - ₹1,018.8722
10.58%8.19%8.40%-5000
Franklin India Banking & PSU Debt Fund4 StarGrowth - ₹15.3516

Dividend - ₹10.6036
11.52%8.08%8.44%-5000

Note – The data is sourced from Value Research as on July 17, 2019. The data pertains to the regular plan of the schemes shown above.

Disclaimer – “Mutual fund investments are subject to market risks. Please read the scheme document carefully before investing”.

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