Find unbiased list of Top 10 Arbitrage Funds in India. In this Article, We will discuss in detail about Best Arbitrage Funds available for Investment in 2024. Along with this, we will also analyze in-depth performance of these list of Arbitrage Funds.
What is Arbitrage Fund?
Arbitrage fund is a form of mutual fund which is treated as equity plan for the purpose of taxation. The investment of these funds is done in both derivatives as well as the cash market. It generates the return to the investors by taking benefit of the differences arising in the prices of securities in derivatives and cash.
The principle of the working of arbitrage fund is based on mis-pricing arising from the equity shares in future and spot market. Shares in the cash market are purchased by the fund manager who then sells it in the derivative market. Whatever difference arises in the selling and cost price is the return earned by the fund manager.
On the reverse side, if the fund manager observes fall in the share prices in future, they curtain on the equity shares in the cash market and enters in the future market for a long contract and would shortly sell its share in the cash market.
These funds generate money for the investors from low-risk buy-and-sell opportunities made available to them in the future and cash market. These funds are favorable to those investors who want to invest in the market which have a lower risk associated with them.
It is a safe option for investors who want to invest their surplus money when there is fluctuation in the given market. The investment is mostly done in securities such as debentures, term deposits, and zero-coupon bonds.
There are various steps to invest in Arbitrage Funds and are as follows:
- Sign-In on the respective website
- Enter the personal details which include the amount and period of investment
- Get access to generated KYC
- Invest in the provided arbitrate funds from the given mutual funds
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Top 10 Arbitrage Funds in India
List of the best performing arbitrage funds are as follows:
| Rank | Name of the Fund | 1 Yr. Return | 3 Yr. Return |
| 1 | Axis Arbitrage Direct-G | 7.20% | 7.04% |
| 2 | Reliance Arbitrage Direct-G | 7.56% | 6.99% |
| 3 | Edelweiss Arbitrage Direct-G | 6.93% | 6.96% |
| 4 | ICICI Pru Equity Arbitrage Direct-G | 7.01% | 6.91% |
| 5 | Indiabulls Arbitrage Direct-G | 6.53% | 6.88% |
| 6 | Kotak Equity Arbitrage Direct-G | 6.98% | 6.85% |
| 7 | L&T Arbitrage Opportunities Direct-G | 6.93% | 6.83% |
| 8 | IDFC Arbitrage Direct-G | 7.15% | 6.78% |
| 9 | Aditya Birla SL Arbitrage Direct-G | 6.76% | 6.73% |
| 10 | Invesco India Arbitrage Direct-G | 6.85% | 6.70% |
Analyze Best Arbitrage Funds of 2024
Here are detailed analysis of Top 10 Arbitrage Funds in India:
Axis Arbitrage Direct – G Fund
These funds aim to generate income through low volatility absolute return strategies while capturing the opportunities in the derivatives and cash segments of the equity market.
These could be done by utilizing them via derivative based strategies and balancing the investments by investing in money and debt market instruments. In this fund, income is generated through low volatility absolute return strategies by taking advantage of opportunities available in cash and derivative segments.
It also includes arbitrage opportunities derived from the derivative segment and also includes investment in debt and money market instruments.
The return for this fund is:
| Period | Return |
| 6 month | 3.4 |
| 1 year | 6.9 |
| 3 years | 6.9 |
Reliance Arbitrage Direct – G Fund
The objective of this fund is to seek generation of income by taking the advantage of arbitrage opportunities which have a potential to exist between derivative and cash market.
There is also derivative segment along with investment done in securities related to the debt and money market instruments. It is an open-ended fund type with high growth which requires minimum management of Rs.5000 crore as it is required for its sustainable growth.
The return for this fund is:
| Period | Return |
| 6 month | 3.4 |
| 1 year | 7.4 |
| 3 years | 6.9 |
Edelweiss Arbitrage Direct – G Fund
The objective of this type of fund is a generation of income by investing predominantly in the arbitrage opportunities which have been available in the cash as well as derivative segments present in the equity market.
Besides, arbitrage opportunities are also available in the derivative segment and also an investment in debt and money market instruments. It is an open-ended fund whose investment plan is based on the dividend. Its minimum size comes around Rs.5000 for its growth in an appropriate manner.
The return for this fund is:
| Period | Return |
| 6 month | 3.3 |
| 1 year | 6.8 |
| 3 years | 6.9 |
ICICI Pru Equity Arbitrage Direct – G Fund
The objective of this fund is to seek low volatility returns by utilization of arbitrage and other derivative strategies in equity-related markets.
It also seeks investment in debt portfolio for a short-term period. It is an open-ended hybrid scheme based on the growth investment plan. This fund could be purchased at a minimum investment of Rs.5000 which would help the investors to grow it to a high extent.
The return for this fund is:
| Period | Return |
| 6 month | 3.4 |
| 1 year | 6.8 |
| 3 years | 6.8 |
Indiabulls Arbitrage Direct – G Fund
The objective of this investment scheme is a generation of income by availing opportunities to invest in cash and derivatives segments so as to enhance the growth of equity market and make balance in the investment done in debt and money market.
It is also an open-ended fund whose growth is an investment plan. It was launched on 15th December 2014 and has a minimum investment of Rs.5000. Its benchmark is CRISIL Liquid fund and asset size is Rs.24.68 crore.
The return for this fund is:
| Period | Return |
| 6 month | 2.7 |
| 1 year | 6.1 |
| 3 years | 6.8 |
Kotak Equity Arbitrage Direct – G Fund
The main purpose of this type of fund is to generate capital appreciation as well as income by investing more in cash and derivative market-related arbitrage opportunities so as to balance the investment done in debt and money market instruments.
It is a growth-related open-ended fund which was launched on 1st January 2013. Its asset size is Rs.2757 crore and has a minimum investment of Rs.5000.
The return for this fund is:
| Period | Return |
| 6 month | 3.4 |
| 1 year | 6.7 |
| 3 years | 6.8 |
L&T Arbitrage Opportunities Direct – G Fund
This scheme is based on the generation of good returns by investing more in the cash and derivatives segment on the equity market and also balancing investment in money and debt market instruments.
It belongs to the family of L&T Mutual fund and is based on arbitrage fund. It is an open-ended fund whose investment plan is based on growth and was launched on 7th July 2014. Its asset size is Rs.395 crore and has a minimum investment of Rs.5000.
The return for this fund is:
| Period | Return |
| 6 month | 3.2 |
| 1 year | 6.6 |
| 3 years | 6.7 |
IDFC Arbitrage Direct – G Fund
It is a capital appreciation scheme whose income is generated by investing in arbitrage opportunities based on derivative and cash segments on the equity market and made the arbitrage opportunities available in investment done in money and debt market.
It is open-ended fund whose investment plan is based on the growth. Its launch date is based on 1st February 2013 and has a minimum investment of Rs.100 and asset size of Rs.1284 crore in its base.
The return for this fund is:
| Period | Return |
| 6 month | 3.4 |
| 1 year | 6.9 |
| 3 years | 6.7 |
Aditya Birla SL Arbitrage Direct – G Fund
This fund takes the advantage of investment done mostly in equity and equity related instruments so as to effectively generate income. It also fully utilize the advantage taken from the mis-pricing which has been prevailing for a longer duration for either index or stock related market segments to a full extent.
It is another type of open-ended growth investment plan type fund related plan. The launching date of such type of fund is 1st February 2013 with a minimum investment of Rs.5000 and total asset size of Rs.2710 crore. By 21st May 2018, this has been renamed as Aditya Birla Sun Lifer Arbitrage Fund.
The return for this fund is:
| Period | Return |
| 6 month | 3.2 |
| 1 year | 6.6 |
| 3 years | 6.7 |
Invesco India Arbitrage Direct – G Fund
In this type of fund, the income is generated using arbitrage opportunities which emerges out after arising out the difference in pricing between derivative and cash related market and also deployment of surplus cash income related instruments.
It was launched in 30th April 2007 and has an asset size of Rs.98.52 crore with the minimum investment of Rs.5000.
The return for this fund is:
| Period | Return |
| 6 month | 3.0 |
| 1 year | 6.5 |
| 3 years | 6.6 |
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