DSP Ultra Short Term Fund Direct Growth Review 2026: NAV, Returns, Portfolio & Should You Invest?

DSP Ultra Short Term Fund Direct Growth Plan is a debt fund with a current NAV of ₹4001.7357 as of 03 Sep 2026 and scheme AUM of ₹4,456 Cr. Its 1-year, 3-year and 5-year returns are 6.82%, 7.46% and 6.64%, and it sits in the Medium Risk category. The fund has been steady rather than flashy, which makes sense for an ultra short-term debt strategy that is aimed at preserving stability while still seeking moderate accrual income.

In our view, the return pattern is more useful for conservative investors than for those looking to outrun equity-style benchmarks. The fund has stayed positive across the displayed horizons and has kept its longer-run compounding broadly consistent, while its portfolio is built around short-dated debt and deposit-style exposures that may help limit day-to-day swings.

Quick facts

The fund is managed by Shalini Vasanta and Karan Mundhra.

Source data date: as of 03 Sep 2026

Performance

Recent numbers have been constructive. The fund’s 1-month and 3-month returns show modest positive movement, and the 1-year return has remained clearly above the benchmark’s negative one-year reading. That matters because it suggests the portfolio has been able to hold up better than the benchmark through a weaker stretch for the index, even though the fund’s own short-term moves remain small by design.

The longer view is also consistent. The 3-year return of 7.46% is ahead of the benchmark’s 5.74%, and the 5-year return of 6.64% is slightly above the benchmark’s 6.27%. This is not a fund that is trying to create a large gap over a market index in every period; instead, it has shown a relatively stable compounding path with only modest variation across time frames.

That said, the recent pattern is not dramatically different from the longer-term trend. The fund has kept returns in a narrow band, which is typical of a lower-volatility debt allocation. For investors, the important point is that the fund’s performance has been steady enough to be read as defensive rather than opportunistic, while still delivering positive accrual-style returns over one, three and five years.

Source data date: as of 03 Sep 2026

Peer comparison

This assessment is prepared by Uniapps Investment Adviser Pvt. Ltd. under SEBI Registered Investment Adviser registration INA000017639. On the one-year number, the fund sits close to the leading peer returns, with Nippon India Ultra Short Term Fund Direct Growth Plan only slightly ahead and the rest of the set clustered tightly around it. The same close clustering continues over three and five years, where the fund is broadly in line with the peer group and only marginally below the strongest figures available.

The short-term picture and the longer-term picture tell a similar story: this is a compact return profile with small differences between peers. The fund does not stand out by a wide margin, but it also does not lag sharply. For investors comparing similar ultra short-term debt options, that usually points to a fund whose return outcome is shaped more by steady execution than by aggressive positioning.

Source data date: as of 03 Sep 2026

Portfolio: where your money goes

The top 10 holdings account for approximately 35.78% of the portfolio.

To see all holdings, visit the DSP Ultra Short Term Fund Direct Growth Plan page

The largest disclosed position is HDFC Bank Ltd at 5.4%, and the next few holdings remain close to that level rather than dropping sharply. By the tenth holding, the weight is 2.7%, so the spread from the top position to the tenth is fairly contained. That suggests no single holding dominates the disclosed set, even though the first few names are large enough to matter in day-to-day portfolio behaviour.

The visible holdings are spread across certificate of deposit, corporate debt and government securities, which may help keep the portfolio anchored in short-duration instruments. With the top 10 holding weights together at 35.78% and 62 holdings disclosed overall, the fund appears to rely on a fairly long tail outside the largest positions. In our view, that can make the portfolio feel more diversified than a highly concentrated debt book, while still leaving the top names likely to have greater influence.

Source data date: as of 03 Sep 2026

Who should invest

This fund is likely to suit investors who are comfortable with Medium Risk and want a conservative debt allocation rather than sharp capital swings. The return pattern across 1 year, 3 years and 5 years is steady, and the benchmark comparison shows that the fund has not relied on a single strong burst to build its record.

An investment horizon of at least a few years makes the most sense if the aim is to let accrual-style returns work through normal interest-rate and credit-market cycles. The main trade-off is that the fund may offer calmer behaviour than many equity-oriented options, but the return potential is naturally more limited and can move in a tight band.

Tax and exit load

Exit load: No exit load after holding period.

Source data date: as of 03 Sep 2026

Frequently asked questions

What is the current NAV of DSP Ultra Short Term Fund Direct Growth Plan?

The current NAV is ₹4001.7357 as of 03 Sep 2026.

What are the fund’s 1-year, 3-year and 5-year returns?

The fund’s 1-year return is 6.82%, its 3-year return is 7.46%, and its 5-year return is 6.64%.

How has the fund compared with the benchmark?

It has outperformed the benchmark on the 1-year, 3-year and 5-year figures shown here. The benchmark return is -4.4% for 1 year, 5.74% for 3 years and 6.27% for 5 years.

How does it compare with peers on recent returns?

Its one-year return is close to the stronger peer figures, with Nippon India Ultra Short Term Fund Direct Growth Plan at 7.07% and Axis Ultra Short Term Fund Direct Growth Plan at 6.86%. The 3-year and 5-year numbers are also tightly grouped among the comparable funds listed.

What is the minimum SIP amount?

The minimum SIP amount is not stated in the available fund details, so it is omitted here.

Who manages the fund and what is the exit load?

The fund is managed by Shalini Vasanta and Karan Mundhra. No exit load applies after the holding period.

Bottom line

DSP Ultra Short Term Fund Direct Growth Plan has shown a steadier long-term pattern than its weak benchmark in the recent year, while remaining close to peer returns across the 1-year, 3-year and 5-year windows. Its Medium Risk label fits the overall behaviour: not risk-free, but designed for lower-volatility debt allocation. The portfolio is led by short-duration holdings and is spread across 62 disclosed positions, which may help soften concentration risk. Overall, the fund looks best suited to investors who want measured debt exposure and can accept modest, steady returns.

Published on 4 September 2026 at 4:23 PM IST