Best Arbitrage Mutual Funds
Arbitrage funds profit from small price gaps between the cash and futures markets rather than from market direction. Returns are usually modest and cash-like, but they are taxed as equity.
Top arbitrage mutual funds by 3Y returns
20Direct plan, Growth option — ranked by 3-year CAGR. Open a fund for NAV history, rolling returns, risk metrics and peer rank.
As of 20 Aug 2026, Tata Arbitrage Fund (Direct plan, Growth option) leads arbitrage mutual funds on 3-year CAGR at +7.55%, followed by Kotak Arbitrage Fund at +7.55% and Invesco India Arbitrage Fund at +7.52%. Across 40 arbitrage mutual funds the category averaged +7.27% over three years, at an average expense ratio of 1.53%. All figures are computed from public AMFI NAV history and recomputed daily; past returns do not predict future ones.
| 1 | Tata Arbitrage Fund Tata | ★★★★☆ | +6.7% | +7.6% | +6.8% | 1.70% | ₹22,684Cr |
| 2 | Kotak Arbitrage Fund Kotak Mahindra | ★★★★☆ | +6.6% | +7.5% | +6.9% | 2.40% | ₹70,783Cr |
| 3 | Invesco India Arbitrage Fund Invesco | ★★★★★ | +6.7% | +7.5% | +7.0% | 2.31% | ₹27,818Cr |
| 4 | Aditya Birla Sun Life Arbitrage Fund Aditya Birla Sun Life | ★★★☆☆ | +6.6% | +7.5% | +6.7% | 1.26% | ₹26,029Cr |
| 5 | Edelweiss Arbitrage Fund Edelweiss | ★★★☆☆ | +6.6% | +7.5% | +6.8% | 1.67% | ₹14,863Cr |
| 6 | Axis Arbitrage Fund Axis | ★★★☆☆ | +6.6% | +7.4% | +6.8% | 1.45% | ₹9,735Cr |
| 7 | Mirae Asset Arbitrage Fund Mirae Asset | ★★★☆☆ | +6.6% | +7.4% | +6.7% | 2.69% | ₹3,657Cr |
| 8 | UTI - Arbitrage Fund UTI | ★★★★☆ | +6.5% | +7.4% | +6.6% | 1.27% | ₹10,939Cr |
| 9 | ICICI Prudential Arbitrage Fund ICICI Prudential | ★★★☆☆ | +6.5% | +7.4% | +6.7% | 1.62% | ₹32,407Cr |
| 10 | Nippon India Arbitrage Fund Nippon India | ★★★★☆ | +6.7% | +7.4% | +6.7% | 1.37% | ₹16,381Cr |
| 11 | BANDHAN Arbitrage Fund Bandhan | ★★★☆☆ | +6.4% | +7.4% | +6.7% | 1.67% | ₹8,114Cr |
| 12 | HDFC Arbitrage Fund HDFC | ★★☆☆☆ | +6.6% | +7.4% | +6.6% | 1.53% | ₹24,544Cr |
| 13 | SBI Arbitrage Opportunities Fund SBI | ★★★☆☆ | +6.5% | +7.4% | +6.8% | 1.46% | ₹46,803Cr |
| 14 | ITI Arbitrage Fund ITI | ★★★☆☆ | +6.4% | +7.3% | +6.1% | 1.11% | ₹82.74Cr |
| 15 | Sundaram Arbitrage Fund Sundaram | ★★★☆☆ | +6.7% | +7.3% | — | 1.05% | ₹483.23Cr |
| 16 | Baroda BNP Paribas Arbitrage Fund Baroda BNP Paribas | ★★★★☆ | +6.3% | +7.3% | — | 1.58% | ₹1,250Cr |
| 17 | DSP Arbitrage fund DSP | ★★★☆☆ | +6.5% | +7.3% | +6.6% | 1.20% | ₹6,460Cr |
| 18 | HSBC Arbitrage Fund HSBC | ★★★★☆ | +6.5% | +7.3% | — | 1.47% | ₹2,652Cr |
| 19 | Union Arbitrage Fund Union | ★★☆☆☆ | +6.5% | +7.3% | +6.5% | 1.52% | ₹243.13Cr |
| 20 | LIC MF Arbitrage Fund LIC | ★★★☆☆ | +6.6% | +7.2% | +6.5% | 1.17% | ₹249.64Cr |
NAV data as of 20 Aug 2026. Returns are CAGR for periods ≥1 year, computed from AMFI NAV history. Ratings are WealthTicker’s own, ranked within sub-category peers — not a SEBI or agency rating. See our methodology for every formula. This is data, not investment advice.
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Frequently asked questions
What are arbitrage mutual funds?
Arbitrage funds profit from small price gaps between the cash and futures markets rather than from market direction. Returns are usually modest and cash-like, but they are taxed as equity.
Which is the best arbitrage fund right now?
Tata Arbitrage Fund by Tata currently ranks first among arbitrage mutual funds by 3-year CAGR at +7.55%. Rankings move with NAVs — past returns don't guarantee future performance.
What returns have arbitrage mutual funds given?
The category has averaged +6.50% over 1 year, +7.27% annualized over 3 years, +6.53% annualized over 5 years — peer averages over the live funds in the category, computed from AMFI NAV history.
How are arbitrage mutual funds taxed?
Equity taxation: gains within 1 year are short-term and taxed at 20%; beyond 1 year, long-term gains above ₹1.25 lakh a year are taxed at 12.5%.