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Best Overnight Mutual Funds in India

Category Snapshot

Total Funds
197In category
3Y Return
+2.6%Annualized
Max Drawdown
-0.1%3Y qtr avg
Low Riskđź“… Short Term

Invests only in overnight securities with near-zero risk.

Best for:Capital PreservationRegular IncomeShort-Term Goals

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Other Duration Funds categories

Short Duration Debt Fund

Medium Duration Debt Fund

Long Duration Debt Fund

Ultra Short-Term Debt Fund

Low Duration Debt Fund

Medium To Long Duration Debt Fund

Understanding Overnight Fund Funds

Overnight funds invest exclusively in overnight securities with near-zero interest rate risk. They are the safest and most liquid mutual fund category, ideal for very short-term cash parking (1-3 months).

How to Choose Overnight Fund Funds

  • Park money for short periods: perfect for holding cash between transactions or upcoming expenses.
  • Compare fund expense ratios: lower fees directly translate to higher net returns on small time periods.
  • Check fund portfolio: diversified across multiple banks reduces counterparty risk.
  • Ask our AI: 'Which Overnight fund has the lowest expense ratio?' or 'Compare Overnight vs Liquid fund returns.'

Frequently Asked Questions

What's the difference between Overnight and Liquid funds?

Overnight funds invest only in overnight securities (1-day maturity). Liquid funds invest in debt up to 91 days. Overnight funds are even safer.

Is my money safe in an Overnight fund?

Yes, completely safe. Overnight securities are backed by banks and RBI. There's virtually zero default risk.

How much return can I expect from Overnight funds?

Currently, Overnight funds yield 5-6% annualized (varies with RBI repo rate). Returns fluctuate based on RBI monetary policy.

Can I use Overnight funds as a savings account alternative?

Absolutely. Overnight funds offer better returns (5-6%) vs bank savings (3-4%) with same-day liquidity.

Important Disclaimer

Mutual fund investments are subject to market risks, read all scheme related documents carefully. Category metrics, comparisons, and AI insights on Qonfido are for educational and informational purposes only. They do not constitute personalized financial advice from a SEBI-registered advisor. Assess your risk appetite and consult a qualified professional before investing.