Better than FDs? This low-risk debt fund has clocked 7.3% for last 21 years

FD vs fund: ₹10,000 grows to ₹43,800 in this 21-year-old scheme

Canara Robeco Mutual Fund’s Savings Fund, a low-duration debt scheme, has completed 21 years, delivering stable returns and positioning itself as a relatively low-risk option for conservative investors.

 

The fund, which invests in debt and money market instruments with a duration of 6–12 months, has generated a 7.29% annual return since inception in 2005, broadly in line with its benchmark.

 

The Scheme’s investment objective is to generate income/capital appreciation by investing in a portfolio comprising of low duration debt instruments and money market instruments. The benchmark of the Scheme is CRISIL Low Duration Debt A-I Index.

 

The last 1-year, 3 years and 5 years Compounded Annual Growth Rate (CAGR) of Regular Plan - Option of the said Scheme were 6.98%, 7.16% and 5.85% respectively as compared to 6.89%, 7.34% and 6.22% of the Benchmark (CRISIL Low Duration Debt A- I Index) and 5.70%, 6.85% and 5.67% of the additional benchmark (CRISIL 1 Year T-Bill Index), respectively considering the returns as on 27th February 2026. 

 

 

Since inception (March 04, 2005), the Scheme (Regular Plan - Growth Option) has delivered a CAGR of 7.29% to investors as against 7.21% of the benchmark and 6.10% of the additional benchmark respectively.

 

Designed for stability, not high growth

 

Unlike equity funds that aim for high returns, this fund is built for:

 

• Capital preservation
• Regular income
• Low volatility

 

As of February 2026, the fund manages assets worth ₹1,350 crore, reflecting steady investor interest in short-term debt funds.

 

Returns: Consistent but moderate

 

The fund’s recent performance shows stable but modest returns:

 

1-year: 6.98%

 

3-year: 7.16%

 

5-year: 5.85%

 

These returns are slightly below or in line with its benchmark, which is typical for low-risk debt funds where consistency matters more than outperformance.

 

What your money would have grown to

 

The fund’s long-term performance highlights the power of steady compounding:

 

₹10,000 invested at launch → ₹43,819 today

 

Monthly SIP of ₹10,000 since inception (₹25.2 lakh invested) → ₹56.46 lakh today

 

SIP return (XIRR): 7.09%

 

While these returns are not as high as equities, they come with significantly lower risk and volatility.

 

Who should invest?

 

This fund is suitable for investors who:

 

• Want to park money for short to medium term (6–18 months)
• Prefer low-risk options over high returns
• Are looking for an alternative to fixed deposits or savings accounts

 

It can also be used as:

 

• A parking fund before investing in equities
• A liquidity buffer in a diversified portfolio

 

How the fund works

 

The scheme invests primarily in:

 

• Short-term debt instruments
• Money market securities
• It can also allocate a small portion (up to 10%) to InvITs, adding some diversification.

 

Because of its short duration, the fund is:

 

• Less sensitive to interest rate changes
• More stable compared to long-term bond funds

 

The Scheme is managed by  Kunal Jain (Fund Manager) and  Avnish Jain (Chief Investment Officer - Fixed Income). The Scheme can allocate 0% to 100% of the total assets towards debt and money market instruments. The scheme may also invest in Invits which ranges from 0% to 10% of the total assets.    Mutual fund investments are subject to market risks and may fluctuate with market conditions. Returns are not guaranteed. Please read all scheme-related documents carefully and consult your financial advisor before investing.