The number
The median ultra-short duration fund returned 6.52% in the year to 6 October 2026. The median low duration fund returned 6.17%, and the median liquid fund 6.47%.
Over three years the order flips: low duration funds made 7.36% a year and ultra-short funds 7.24%.
All figures are for the Direct plan, Growth option, computed from daily NAVs to 6 October 2026. Returns over a year are compounded annual rates. There are 25 ultra-short and 23 low duration funds with a year's record. AMFI's category names are used here; the funds themselves now carry "Ultra Short Term" and "Ultra Short to Short Term" in their names.
Two categories, side by side
| Period | Ultra short | Low duration | Liquid | Money market |
|---|---|---|---|---|
| 1 month | 0.46% | 0.35% | 0.46% | 0.46% |
| 3 months | 1.57% | 1.32% | 1.56% | 1.59% |
| 6 months | 3.57% | 3.46% | 3.25% | 3.65% |
| 1 year | 6.52% | 6.17% | 6.47% | 6.50% |
| 3 years (a year) | 7.24% | 7.36% | 6.93% | 7.37% |
| 5 years (a year) | 6.62% | 6.60% | 6.37% | 6.69% |
| Volatility | 0.37% | 0.50% | 0.17% | 0.42% |
| Worst 3-year fall | 0.08% | 0.22% | 0.01% | 0.15% |
| Expense ratio | 0.31% | 0.34% | 0.14% | 0.17% |
Median Direct Growth figures. Low duration funds lend for longer, roughly six to twelve months against three to six, so their prices move more. Over the last three months that cost them: 1.32% against 1.57%. Over three years the extra time was paid for; over five the two are level.
Eighteen of the 25 ultra-short funds beat the liquid median over one year; none of the 23 low duration funds did. Over three years, 22 of 24 ultra-short funds and all 20 low duration funds with a record beat it.
Ultra-short funds: best and worst
| Fund | TER | 1 year | 3 years (a year) | 5 years (a year) | Worst 3-year fall |
|---|---|---|---|---|---|
| Tata | 0.33% | 6.99% | 7.51% | 6.82% | 0.09% |
| Nippon India | 0.34% | 6.95% | 7.58% | 7.02% | 0.09% |
| Axis | 0.36% | 6.75% | 7.45% | 6.81% | 0.09% |
| Invesco India | 0.27% | 6.73% | 7.34% | 6.66% | 0.08% |
| LIC MF | 0.25% | 6.72% | 7.25% | 6.35% | 0.07% |
| ... | |||||
| HDFC | 0.39% | 6.37% | 7.22% | 6.59% | 0.12% |
| PGIM India | 0.33% | 6.26% | 7.06% | 6.50% | 0.06% |
| Motilal Oswal | 0.25% | 6.18% | 6.43% | 5.82% | 0.05% |
The gap from first to last is 0.81 points, about ₹8,100 a year on ₹10 lakh before tax. The middle half of the funds sat between 6.45% and 6.65%.
This is one category where the order held. Tata and Nippon India are first and second over one, three and five years. Motilal Oswal is last over all three.
Low duration funds: best and worst
| Fund | TER | 1 year | 3 years (a year) | 5 years (a year) | Worst 3-year fall |
|---|---|---|---|---|---|
| Franklin India | 0.27% | 6.35% | n/a | n/a | n/a |
| LIC MF | 0.24% | 6.34% | 7.37% | 6.56% | 0.18% |
| Tata | 0.27% | 6.31% | 7.32% | 6.55% | 0.20% |
| Nippon India | 0.39% | 6.31% | 7.46% | 6.77% | 0.21% |
| Mahindra Manulife | 0.34% | 6.30% | 7.45% | 6.71% | 0.23% |
| ... | |||||
| SBI | 0.44% | 5.90% | 7.23% | 6.54% | 0.21% |
| DSP | 0.31% | 5.88% | 7.13% | 6.46% | 0.26% |
| Union | 0.26% | 5.69% | n/a | n/a | n/a |
Here the ranks move. Aditya Birla Sun Life is 17th of 23 over one year (6.03%) and first of 17 over five (6.78%). The best three-year figure, HSBC's 7.85%, rests on one day: its NAV rose 1.29% on 28 April 2025. Without that day it would be about 7.39%, close to the median.
What the tables show
- Cost does not sort these funds. Ultra-short TERs run from 0.13% to 0.42%, but Motilal Oswal, last, charges 0.25%, less than Tata or Nippon India.
- The quiet record is recent. The full NAV history holds much bigger one-day falls: PGIM India's ultra-short fund lost 30.29% on 13 September 2019, and the JM and UTI low duration funds lost 10.20% and 8.77% on 4 June 2019. All three dates are outside the five-year window.
- One fund is in the wrong drawer. Union Short Term Fund sits in AMFI's ultra-short list, but its August disclosure gives a Macaulay duration of 2.57 years and its volatility, 1.19%, is three times the category median. It returned 4.62% in the year and is left out of the figures above.
What this does not tell you
Yields are not in this table. What the portfolios earn now is in our debt fund YTM post.
A small gap can reverse. In a category where the middle half spans 0.20 points, next year's order can differ.
Young funds are thin. Franklin India, Union, Bajaj Finserv, JioBlackRock and Edelweiss have little or no record.
Direct plans only. Regular plans cost more and return less.
Where to go from here
The ultra-short and low duration category pages rank every fund. For the next rungs, see money market fund returns and debt fund returns, overnight to gilt. The guide to overnight, liquid and ultra-short funds explains what each holds, and the debt fund duration ladder carries on from there.
Frequently asked questions
How much did ultra-short duration funds return in the last year?
The median ultra-short fund (Direct plan, Growth option) returned 6.52% in the year to 6 October 2026. The 25 funds with a year's record ranged from 6.18% (Motilal Oswal) to 6.99% (Tata), and the median liquid fund returned 6.47%.
Are low duration funds better than ultra-short funds?
Not over the last year: the median low duration fund returned 6.17% against 6.52% for ultra-short funds. Over three years low duration funds were slightly ahead, 7.36% a year against 7.24%, and over five years the two were level at 6.60% and 6.62%.
Can an ultra-short or low duration fund lose money?
Not over the last three years: the median ultra-short fund's worst fall from a peak was 0.08% and the median low duration fund's 0.22%. Older records are different. PGIM India's ultra-short fund lost 30.29% of its NAV in one day on 13 September 2019.
This is commentary on published data, not investment advice. WealthTicker is not a SEBI-registered adviser or distributor. Figures are as of the dates stated and can be revised by their source.
Keep reading
Bharat Bond indices for 2030–33: a quiet ride, a dip
NSE's Nifty BHARAT Bond indices for April 2030 to 2033 have risen 7.8% to 10.8% since January 2025, but each is 0.4% to 1.8% below its August peak.
Conservative hybrid funds returned 1.99% in a year
To 6 October 2026 the median conservative hybrid fund returned 1.99% in a year, against 6.47% for liquid funds. Over five years it led, 7.39% to 6.37%.
Floater funds: ahead over three years, behind over one
To 6 October 2026 the 12 floating rate funds returned a median 5.98% in a year, below liquid funds' 6.47%, but 7.60% a year over three years against 6.93%.