Mutual Funds
Best Investment Plans For 1 Year
Beginner investors often look for short term investment plans as a way to keep their investment journey safe. There are a lot of investment plans in India. So, we have chosen some of the best investment plans in India. In this article, we will share the same with you.
Let’s look at the best investment plans for 1 year that you can invest into.
1.) Debt Mutual Funds
A Debt Mutual Fund is a type of mutual fund that lends your money to the government and companies to generate returns. Note that the risk level of the debt fund is determined by the lending duration and the kind of borrower.
One can invest into debt funds for even one day, or up to 3 years. The investor can have one benefit, that is, debt funds offer better post-tax returns than FDs on investments of up to 3 years.
| Scheme Name | Expense Ratio | 1 Year Returns (p.a.) |
| ICICI Prudential Short Term Fund | 0.45% | 7.76% |
| Tata Money Market Fund | 0.17% | 7.62% |
| ICICI Prudential Savings Fund | 0.4% | 7.58% |
| HDFC Low Duration Fund | 0.45% | 7.57% |
| ICICI Prudential Corporate Bond Fund | 0.32% | 7.55% |
| Aditya Birla Sun Life Money Manager Fund | 0.21% | 7.54% |
| Kotak All Weather Debt FOF | 0.07% | 7.52% |
| Nippon India Ultra Short Duration Fund | 0.38% | 7.51% |
| UTI Money Market Fund | 0.2% | 7.5% |
| Axis Money Market Fund | 0.17% | 7.5% |
| Aditya Birla Investment Plans: A Comprehensive Guide
2.) Liquid Funds
Liquid Funds are a type of short term mutual funds that investors can consider and make short-term investments of up to one year. Typically, these liquid funds invest in money market instruments that mature within 90 days. But because of the short investment period, there is no risk of losing your money. Investors can also seek for best SIP plans for 1 year.
Here are the top 10 liquid fund schemes:
| Scheme Name | NAV Direct | Return 1 Month (%) | Return 3 Month (%) | Return 1 Year (%) Direct |
| Aditya Birla Sun Life Liquid Fund | 342.87 | 3.69 | 3.66 | 3.48 |
| Axis Liquid Fund | 2,362.39 | 3.66 | 3.62 | 3.46 |
| Baroda BNP Paribas Liquid Fund | 2,451.08 | 3.68 | 3.66 | 3.51 |
| BOI AXA Liquid Fund | 2,447.36 | 3.72 | 3.65 | 3.46 |
| Canara Robeco Liquid Fund | 2,548.13 | 3.50 | 3.48 | 3.35 |
| DSP Liquidity Fund | 3,040.88 | 3.66 | 3.63 | 3.45 |
| Edelweiss Liquid Fund | 2,745.72 | 3.59 | 6.54 | 3.54 |
| Franklin India Liquid Fund | 3,196.67 | 3.57 | 3.63 | 3.46 |
| HDFC Liquid Fund | 4,181.65 | 3.62 | 3.57 | 3.43 |
| HSBC Cash Fund | 2,118.21 | 3.60 | 3.62 | 3.45 |
3.) Ultra-Short Duration Funds
The Ultra Short-Duration Funds invest money based on duration and not the term to maturity, making them flexible. These funds invest in debt securities that mature in 3-6 months.
Here are some of the top 10 best-performing ultra-short duration funds:
| Scheme | Return 1 Month (%) | Return 3 Month (%) | Return 1 Year (%) |
| Aditya Birla Sun Life Savings Fund | 4.54 | 4.59 | 4.36 |
| Axis Ultra Short Term Fund | 4.74 | 4.50 | 4.22 |
| Baroda BNP Paribas Ultra Short Duration Fund | 4.30 | 4.34 | 4.12 |
| BOI AXA Ultra Short Duration Fund | 4.04 | 3.82 | 3.53 |
| Canara Robeco Ultra Short Term Fund | 3.92 | 3.64 | 3.35 |
| DSP Ultra Short Fund | 4.28 | 4.22 | 3.79 |
| Franklin India Ultra Short Bond Fund | 10.37 | 8.73 | 12.28 |
| HDFC Ultra Short Term Fund | 4.33 | 4.13 | 3.99 |
| HSBC Ultra Short Duration Fund | 4.18 | 4.06 | 3.86 |
| ICICI Prudential Ultra Short Term Fund | 4.17 | 4.40 | 4.55 |
4.) Low Duration Funds
Similar to ultra-short duration funds, low duration funds invest in securities based on duration. However, the duration period of these funds ranges between 6-12 months. So, if you want to invest for a tenure of up to 1 year, these funds are best suited for you.
Here you can look at some of the best-performing low-duration funds:
| Scheme Name | NAV | Return 1 Month (%) | Return 3 Month (%) | Return 1 Year (%) |
|---|---|---|---|---|
| Aditya Birla Sun Life Low Duration | 577.59 | 5.74 | 4.86 | 4.78 |
| Axis Treasury Advantage Fund | 2,587.15 | 5.74 | 4.86 | 4.76 |
| Baroda BNP Paribas Low Duration | 35.14 | 4.06 | 4.76 | 4.48 |
| Canara Robeco Savings Fund | 34.81 | 3.88 | 3.88 | 3.66 |
| DSP Low Duration Fund | 16.44 | 4.38 | 4.22 | 4.04 |
| Franklin India Low Duration Fund | 28.09 | 29.00 | 14.44 | 18.12 |
| HDFC Low Duration Fund | 49.73 | 5.13 | 4.19 | 4.62 |
| HSBC Low Duration Fund | 17.92 | 4.24 | 4.36 | 4.31 |
| ICICI Prudential Savings Fund | 436.8 | 6.75 | 2.97 | 4.06 |
| IDFC Low Duration Fund | 31.83 | 3.84 | 4.05 | 3.97 |
5.) Money Market Funds
Money market funds invest in money market instruments for a tenure of up to 1 year. Note that most of these money market funds are very liquid and usually low risk. In addition, unlike duration funds, there is no credit risk.
Below are some of the best scheme names with their returns:
| Scheme Name | NAV Direct | Return 1 Month (%) Direct | Return 3 Month (%) Direct | Return 1 Year (%) Direct |
|---|---|---|---|---|
| Aditya Birla Sun Life Money Manager | 298.62 | 4.45 | 4.36 | 4.09 |
| Axis Money Market Fund | 1,150.64 | 4.68 | 4.40 | 4.05 |
| Baroda BNP Paribas Money Market | 1,128.24 | 3.63 | 4.02 | 3.47 |
| DSP Savings Fund | 43.72 | 4.48 | 3.89 | 4.00 |
| Edelweiss Money Market Fund | 25.25 | 4.19 | 3.94 | 3.78 |
| Franklin India Savings Fund | 41.45 | 4.11 | 3.89 | 3.86 |
| HDFC Money Market Fund | 4,649.96 | 4.53 | 4.23 | 4.05 |
| ICICI Prudential Money Market Fund | 306.58 | 4.66 | 4.11 | 3.93 |
| IDFC Money Manager Fund | 34.88 | 4.29 | 4.12 | 3.76 |
| Invesco India Money Market Fund | 2,537.87 | 4.32 | 3.97 | 3.94 |
6.) Floater Funds
Floater funds are debt funds that invest more than 65% of their money in floating-rate bonds, which carry credit risk. The interest paid by these bonds often changes according to the changes in the economy. These funds require a periodic reset to keep them in sync with the market rates. Such short-term investment plans are suitable when interest rates are rising.
Below are some of the best floater fund schemes:
| Scheme Name | NAV Direct | Return 1 Year (%) Direct |
| Aditya Birla Sun Life Floating Rate Fund | 283.11 | 4.76 |
| DSP Floater Fund | 10.50 | 4.48 |
| Franklin India Floating Rate Fund | 34.57 | 4.04 |
| HDFC Floating Rate Debt Fund | 40.06 | 4.72 |
| ICICI Prudential Floating Interest Fund | 359.83 | 4.39 |
| IDFC Floating Rate Fund | 10.46 | 4.35 |
| Kotak Floating Rate Fund | 1,225.05 | 6.12 |
| Nippon India Floating Rate Fund | 37.71 | 5.00 |
| SBI Floating Rate Debt Fund | 10.64 | 4.23 |
| UTI Floater Fund | 1,257.02 | 4.04 |
7.) Arbitrage Mutual Funds
Arbitrage funds are a type of short-term mutual funds that leverage the price differential in the cash and derivatives market to generate returns. Note that these returns are heavily dependent on the volatility of the asset. In addition, these funds are considered hybrid funds but are similar to debt funds.
Here are the top 10 arbitrage funds:
| Scheme Name | NAV | Return 1 Year (%) |
| Aditya Birla Sun Life Arbitrage Fund | 22.74 | 4.58 |
| Axis Arbitrage Fund | 16.17 | 4.82 |
| Baroda BNP Paribas Arbitrage Fund | 13.54 | 4.38 |
| BOI AXA Arbitrage Fund | 11.78 | 2.96 |
| DSP Arbitrage Fund | 12.47 | 4.20 |
| Edelweiss Arbitrage Fund | 16.47 | 4.74 |
| HDFC Arbitrage Fund | 16.07 | 4.26 |
| ICICI Prudential Equity Arbitrage Fund | 29.27 | 4.49 |
| IDFC Arbitrage Fund | 27.90 | 4.38 |
| Indiabulls Arbitrage Fund | 15.22 | 3.08 |
8.) Fixed Maturity Plans
Fixed Maturity Plans, also known as FMP, are a type of debt fund that invests in fixed-income instruments such as a certificate of deposit. This is done so that the plan can eliminate any fluctuation in interest rates due to debt markets.
This type of fund has a fixed maturity since they are close-ended mutual funds. The tenure can vary from a short-term investment tenure of 30 days to 5 years. Below are the best performing FMPs:
| Mutual Fund | AUM in Cr | Since Inception |
|---|---|---|
| Nippon India Interval Fund Quarterly Interval Fund Series III (G) | 13 | 7.2% |
| Nippon India Interval Fund Monthly Interval Fund Series II Direct Plan (G) | 4 | 6.5% |
| Nippon India Interval Fund Monthly Interval Fund Series I Direct Plan (G) | 3 | 6.5% |
| Nippon India Interval Fund Quarterly Interval Fund Series I (G) | 3 | 7.0% |
| UTI Quarterly Interval Fund III (G) | 11 | 7.0% |
| Nippon India Interval Fund Quarterly Interval Fund Series III Direct Plan (G) | 13 | 6.6% |
| Nippon India Interval Fund Monthly Interval Fund Series II (G) | 4 | 6.9% |
| Nippon India Interval Fund Quarterly Interval Fund Series II (G) | 46 | 7.3% |
| UTI Quarterly Interval Fund III DIRECT (G) | 11 | 6.7% |
| Nippon India Interval Fund Monthly Interval Fund Series I (G) | 3 | 6.9% |
9.) Post Office Term Deposit
Post Office Investment plans are one of the most steady and secure investment plans. These plans are offered by post offices across India that are backed by the Indian government. In addition, the schemes offer a high return rate and tax benefits.
Moreover, if you’re looking for the best investment plan for monthly income, you can look for the Post Office Monthly Income Scheme Account (MIS). Here are some of the best post office schemes:
| Scheme Name | Interest Rates (p.a.) | Minimum Deposit |
|---|---|---|
| Post Office Savings Account | 4% | ₹500 |
| Post Office Time Deposit Account (TD) | One year: 6.9% Two years: 7.0% Three years: 7.0% Five years: 7.5% The interest compounds quarterly | ₹1,000 |
| Post Office Monthly Income Scheme Account (MIS) | 7.4% per annum payable monthly | ₹1,000 |
| Senior Citizen Savings Scheme (SCSS) | 8.2% (Compounded quarterly) | ₹1,000 |
| 15-year Public Provident Fund Account (PPF) | 7.1% (Compounded annually) | ₹500 per financial year |
| National Savings Certificates (NSC) | 7.7% (Compounded annually) | ₹1,000 |
| Kisan Vikas Patra | 7.5% (Compounded annually) | ₹1,000 |
| Sukanya Samriddhi Account | 8% (Compounded annually) | ₹250 per financial year |
10.) Fixed Deposit
An FD or Fixed Deposit is one of the best investment plans across India that offers a fixed interest rate for up to a fixed investment tenure on your investment. It’s particularly popular because you know what amount you will receive at maturity. Hence, making it completely risk-free.
Here are some of the FD schemes with high-interest rates:
| Bank Name | Cumulative Deposit |
|---|---|
| Shriram Transport Finance Ltd Fixed Deposit | 9.10% |
| SBI Bank Fixed Deposit Rates | 3.5% to 7.25% |
| Mahindra Finance Ltd Fixed Deposit | 7.50% |
| Axis Bank Fixed Deposit Rates | 3.5% to 8.01% |
| ICICI Bank Fixed Deposit Rates | 3.5% to 7.50% |
| HDFC Bank Fixed Deposit Rates | 3.5% to 7.75% |
| IndusInd Bank Fixed Deposit Rates | 4% to 7.85% |
| Federal Bank Fixed Deposit Rates | 3.5% to 7.75% |
| Canara Bank Fixed Deposit Rates | 3.25% to 7.65% |
| Union Bank of India Fixed Deposit Rates | 3.5% to 7.8% |
11.) Recurring Deposit
Recurring Deposit (RD) is one of the most popular and preferred risk-free investment options in India. An RD investment allows investors to make a fixed monthly investment for a fixed tenure. Depending on the bank you choose, the interest rates can vary from 2.50% - 8.50%.
These investments are similar to a Fixed Deposit, however, what makes RD different is the flexibility of monthly investments. You can choose your investment tenure from as little as 6 months to 10 years.
| Bank Name | General Interest Rates | Senior Citizen Interest Rates |
|---|---|---|
| SBI Recurring Deposit | 4.40% - 5.50% | 4.90% - 6.20% |
| ICICI Recurring Deposit | 3.50% - 5.50% | 4.00% - 6.30% |
| HDFC Recurring Deposit | 4.40% - 5.50% | 4.90% - 6.25% |
| Kotak Bank Recurring Deposit | 4.30% - 5.20% | 4.80% - 5.70% |
| Axis Bank Recurring Deposit | 4.40% - 5.75% | 4.65% - 6.50% |
| BOB Recurring Deposit | 4.30% - 5.25% | 4.80% - 5.75% |
| IDFC First Bank | 6.75% - 7.25% | 6.75% - 7.25% |
| PNB | 4.40% - 5.30% | 4.90% - 6.05% |
| IDBI Bank | 7.00% - 7.15% | 7.50% - 7.65% |
| Citibank | 2.75% - 3.00% | 3.25% - 4.00% |
FAQs
1. What is the minimum amount I need to invest?
The minimum amount of investment depends on the type of investment that you choose. So, the best is to determine the type of investment you want to make and search for more information on the same.
2. How do I compare different investment options?
Since different investment plans have different benefits and risks, the best you can do is look at their risk rate and annual return rates.
3. What are the tax implications of short-term investments?
The tax implications depend highly on the type of investment you’re making. For example, a post office investment scheme may offer tax-free benefits while a mutual fund may not.
4. What are the risks involved in short-term investments?
Taxes and inflation often reduce the returns offered by short-term investments. In addition, short-term investments offer low returns and growth as compared to long-term investments.
5. How can I ensure the safety of my investments?
Here are some of the ways with which you can ensure the safety of your investments:
- Diversify your portfolio by investing in various sectors.
- Invest according to your risk appetite.
- Avoid any impulsive investments.