Best Ultra Short Duration Mutual Funds
Ultra short duration funds run a Macaulay duration of 3 to 6 months. That is a step out from a liquid fund — slightly more interest-rate sensitivity in exchange for slightly more yield, for money you need in months rather than days.
Top ultra short duration 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 05 Oct 2026, Nippon India Ultra Short Term Fund (Direct plan, Growth option) leads ultra short duration mutual funds on 3-year CAGR at +7.57%, followed by Tata Ultra Short Term Fund at +7.51% and Aditya Birla Sun Life Ultra Short Term Fund at +7.48%. Across 27 ultra short duration mutual funds the category averaged +7.23% over three years, at an average expense ratio of 0.30%. All figures are computed from public AMFI NAV history and recomputed daily; past returns do not predict future ones.
| 1 | Nippon India Ultra Short Term Fund Nippon India | ★★★★☆ | +7.0% | +7.6% | +7.0% | 0.34% | ₹11,899Cr |
| 2 | Tata Ultra Short Term Fund Tata | ★★★☆☆ | +7.0% | +7.5% | +6.8% | 0.33% | ₹6,339Cr |
| 3 | Aditya Birla Sun Life Ultra Short Term Fund Aditya Birla Sun Life | ★★★★☆ | +6.6% | +7.5% | +6.8% | 0.32% | ₹18,395Cr |
| 4 | Axis Ultra Short Term Fund Axis | ★★★☆☆ | +6.8% | +7.4% | +6.8% | 0.36% | — |
| 5 | Mirae Asset Ultra Short-Term Fund Mirae Asset | ★★★★☆ | +6.7% | +7.4% | +6.7% | 0.22% | ₹2,015Cr |
| 6 | DSP Ultra Short Term Fund DSP | ★★★☆☆ | +6.7% | +7.4% | +6.7% | 0.30% | ₹4,604Cr |
| 7 | ICICI Prudential Ultra Short term Fund ICICI Prudential | ★★★★☆ | +6.6% | +7.4% | +6.8% | 0.40% | ₹15,759Cr |
| 8 | Invesco India Ultra Short Term Fund Invesco | ★★★★★ | +6.7% | +7.3% | +6.7% | 0.27% | ₹1,314Cr |
| 9 | UTI Ultra Short Term Fund UTI | ★★★★★ | +6.6% | +7.3% | +6.7% | 0.38% | ₹3,501Cr |
| 10 | Mahindra Manulife Ultra Short Term Fund Mahindra Manulife | ★★★☆☆ | +6.6% | +7.3% | +6.6% | 0.31% | — |
| 11 | Sundaram Ultra Short Term Fund Sundaram | ★★★★★ | +6.5% | +7.3% | — | 0.23% | ₹2,578Cr |
| 12 | LIC MF Ultra Short Term Fund LIC | ★★★☆☆ | +6.7% | +7.2% | +6.3% | 0.25% | ₹645.28Cr |
| 13 | Baroda BNP Paribas Ultra Short Term Fund Baroda BNP Paribas | ★★★☆☆ | +6.6% | +7.2% | +6.7% | 0.29% | ₹679.39Cr |
| 14 | HDFC Ultra Short Term Fund HDFC | ★☆☆☆☆ | +6.4% | +7.2% | +6.6% | 0.39% | ₹17,067Cr |
| 15 | HSBC Ultra Short Duration Fund HSBC | ★★★☆☆ | +6.5% | +7.2% | +6.6% | 0.18% | — |
| 16 | Kotak Ultra Short Term Fund Kotak Mahindra | ★★☆☆☆ | +6.5% | +7.2% | +6.6% | 0.36% | ₹15,663Cr |
| 17 | SBI Ultra Short Term Fund SBI | ★★☆☆☆ | +6.4% | +7.2% | +6.5% | 0.35% | ₹11,771Cr |
| 18 | Bandhan Ultra Short Term Fund Bandhan | ★☆☆☆☆ | +6.5% | +7.2% | +6.5% | 0.30% | ₹4,384Cr |
| 19 | ITI Ultra Short Term Fund ITI | ★★★★☆ | +6.5% | +7.1% | +6.4% | 0.21% | ₹163.28Cr |
| 20 | PGIM India Ultra Short Term Fund PGIM India | ★★★★☆ | +6.3% | +7.1% | +6.5% | 0.33% | ₹198.20Cr |
NAV data as of 05 Oct 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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Understand ultra short duration mutual funds
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Frequently asked questions
What are ultra short duration mutual funds?
Ultra short duration funds run a Macaulay duration of 3 to 6 months. That is a step out from a liquid fund — slightly more interest-rate sensitivity in exchange for slightly more yield, for money you need in months rather than days.
Which is the best ultra short duration fund right now?
Nippon India Ultra Short Term Fund by Nippon India currently ranks first among ultra short duration mutual funds by 3-year CAGR at +7.57%. Rankings move with NAVs — past returns don't guarantee future performance.
What returns have ultra short duration mutual funds given?
The category has averaged +6.50% over 1 year, +7.23% annualized over 3 years, +6.57% annualized over 5 years — peer averages over the live funds in the category, computed from AMFI NAV history.
How are ultra short duration mutual funds taxed?
Debt taxation: all gains are added to your income and taxed at your slab rate, regardless of holding period (for units bought on or after 1 April 2023).