Medium Duration Mutual Funds

Medium Duration Mutual Funds

Medium duration Funds are the conservative type of investment instruments, this type of mutual fund are the debt funds investment options offering the duration of three to four years. When compared with other debt funds, liquid funds, overnight funds, etc., these funds offer higher returns ranging from 7 to 9%. These funds invest in money markets and debt securities for a duration of 3 or 4 years to offer fruitful returns and the end of the tenure. When it comes for investment options, there are many ways to invest your money. Based on financial status, risk baring capacity, holding period, etc. an investor will choose the investment instruments. Medium Duration Mutual funds when compared with the holding period works as same as Fixed deposit schemes bit offers higher returns than FD.

What are the factors to be considered to invest in Medium Duration Funds?


These funds come with 3 types of risks like credit risk, interest rate risk, liquidity risk. So before investing into these debt funds, consult the fund manager and consider the objectives that you can handle then go for it.

Expense ratio:

It is the fee that is charged by the investment companies, whenever you go for investing your money look for low expense ratio, lower the expense ratio higher will be your gains.


If the holding period is less than 36 months, then the short-term capital gain tax is applied. If more than 36 months long term capital tax gain applied say 20%. The dividends received are tax free (Terms apply).

What are the advantages of Medium duration Funds?

  • Comparatively less volatile than equity funds
  • Stable investment option
  • Lower risks
  • More chances to gain stable returns.
  • Offers liquidity (Terms Apply)

List of Top Medium Duration Funds in India?

  • SBI Magnum Medium Duration Fund
  • ICICK Prudential Retirement Fund
  • IDFC Bond Fund
  • HDFC Medium Term Debt Fund
  • Axis Strategic Bond Fund
  • L&T Resurgent India Bond Fund
  • Kotak Medium Term Fund
  • Sundaram Medium Term Bond Fund
  • Tata Medium Term Fund
  • Nippon India Classic Bond Fund

Bottom Line:

Medium duration Mutual funds are ideal investment option who are looking for the medium time duration of 3 to 4 years. Also, it is the best debt fund investment instrument who are lower risk averse and looking for stable return gains.