Medium duration mutual fund

Mon, 18 May 2026 00:00:00 +0000

A medium duration mutual fund is a SEBI-categorised debt mutual fund scheme that maintains a Macaulay duration of 3 to 4 years. The category was defined under the SEBI October 2017 categorisation framework as one of the 16 debt scheme sub-categories, positioned between short duration funds (1-3 years) and medium to long duration funds (4-7 years).

For Indian retail investors, medium duration funds offer:

Medium-term horizons (3-5 years): Suitable for goal funding within this timeframe.
Yield premium over shorter-duration debt categories.
Moderate interest-rate sensitivity: Material NAV reaction to rate changes (positive in rate-cut cycles, negative in rate-hike cycles).
Variable credit quality: AMCs may hold higher-credit-risk papers for additional yield.

This article covers the SEBI category framework, the typical risk-return profile, the major schemes, the comparison with neighbouring categories, and the post-2023 tax treatment.

Medium Duration on WebNotes

Medium duration mutual fund