Franklin India Arbitrage Fund Direct Growth Review 2026: NAV, Returns, Portfolio & Should You Invest?
- September 15, 2026
- Posted by: Chaitanya Auti
- Category: Mutual Funds
Franklin India Arbitrage Fund Direct Growth Plan currently has a NAV of ₹11.3039 as of 11 September 2026 and an AUM of ₹1,905 Cr. Its 1-year, 3-year and 5-year returns are 6.94%, Data not available and Data not available. The fund sits in the Low Risk bucket, which fits its arbitrage design and relatively steady recent movement.
Our view is that this fund may suit conservative investors who want a lower-volatility hybrid allocation and are comfortable with returns that can be modest but steadier than the equity benchmark. Its recent performance has also held up better than the benchmark, while the portfolio remains diversified across cash-like instruments, banks and large liquid names.
Quick facts
| Particular | Details |
|---|---|
| NAV | ₹11.3039 as of 11 Sep 2026 |
| AUM | ₹1,905 Cr |
| Expense Ratio | 0.29% |
| Launch Date | 19 Nov 2024 |
| Min SIP | ₹500 |
| Risk Category | Low Risk |
| Benchmark | Nifty 50 |
| Fund Category | Hybrid |
| Exit Load | Nil for 10% of units and 1% for remaining units on or before 30D, Nil after 30D |
| Fund Managers | Mukesh Jain, Rajasa Kakulavarapu, Pallab Roy, Rohan Maru |
The fund is managed by Mukesh Jain, Rajasa Kakulavarapu, Pallab Roy and Rohan Maru.
Source data date: as of 11 Sep 2026
Performance
| Period | Fund return | Benchmark return |
|---|---|---|
| 1M | 0.51% | -3.66% |
| 3M | 1.62% | -1.91% |
| 1Y | 6.94% | -7.62% |
| 3Y | Data not available | Data not available |
| 5Y | Data not available | Data not available |
The fund has stayed positive over the recent 1-month, 3-month and 1-year windows, which is consistent with the low-volatility profile shown in its riskometer. Even in a weak benchmark backdrop, the fund remained in positive territory, so the short-term pattern looks more stable than the benchmark’s direction.
The benchmark has been negative across the same short horizons, while this fund has still delivered small gains. That gap matters for conservative investors because it suggests the fund is not trying to mirror the equity market’s swings; instead, it is behaving more like a steady arbitrage strategy with limited upside but also limited drawdown.
The 1-year return of 6.94% is the only longer trailing figure available here, so we cannot frame a 3-year or 5-year compounding story. What we can say is that the recent path has been smoother than the benchmark’s, and that can be useful when an investor values consistency over aggressive growth.
Source data date: as of 11 Sep 2026
Should you BUY or HOLD Franklin India Arbitrage?
A fund’s past returns alone don’t tell you whether you should buy it today or continue holding it.
The right decision depends on factors such as your current allocation, purchase price, risk profile, investment horizon and the role this fund plays in your overall portfolio.
Already holding Franklin India Arbitrage? Thinking of investing now?
Peer comparison
| Fund | 1Y return | 3Y return | 5Y return |
|---|---|---|---|
| Franklin India Arbitrage Fund Direct Growth Plan | 6.94% | Data not available | Data not available |
| Quant Arbitrage Fund Direct Growth Plan | 7.6% | Data not available | Data not available |
| WOC Arbitrage Fund Direct Growth Plan | 7.08% | Data not available | Data not available |
| Motilal Oswal Arbitrage Fund Direct Growth Plan | 6.92% | Data not available | Data not available |
| Invesco India Arbitrage Fund Direct Growth Plan | 6.76% | 7.46% | 7% |
This assessment is prepared by Uniapps Investment Adviser Pvt. Ltd. under SEBI Registered Investment Adviser registration INA000017639. On the latest 1-year figure, the fund trails Quant Arbitrage Fund Direct Growth Plan and WOC Arbitrage Fund Direct Growth Plan, but it remains close to Motilal Oswal Arbitrage Fund Direct Growth Plan. That makes the short-term comparison fairly tight rather than one-sided.
The longer-horizon picture is limited because most peer entries do not carry 3-year or 5-year figures here. Among the funds with longer history data available, Invesco India Arbitrage Fund Direct Growth Plan shows 7.46% over 3 years and 7% over 5 years, which places this fund at a disadvantage on the available long-term comparison. So the recent comparison is more competitive than the longer-term comparison.
Source data date: as of 11 Sep 2026
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Portfolio: where your money goes
| Holding | Sector | Weight |
|---|---|---|
| Franklin India Money Market Fund Direct-Growth Plan ^^ ~~ | Domestic Mutual Funds Units | 11.01% |
| HDFC Bank Ltd ! ~~ | Bank | 6.27% |
| ICICI Bank Ltd !! ~~ | Bank | 4.9% |
| Axis Bank Ltd # * | Bank | 3.73% |
| Reliance Industries Ltd ## ~~ | Crude Oil | 3.35% |
| Vodafone Idea Ltd | Telecom | 2.83% |
| Bharti Airtel Ltd ## !! | Telecom | 2.78% |
| Bank of Baroda (04-Dec-2026) | Certificate of Deposit | 2.58% |
| Canara Bank (30-Nov-2026) | Certificate of Deposit | 2.58% |
| National Bank for Agriculture & Rural Development (17-Mar-2027) | Certificate of Deposit | 2.53% |
The top 10 holdings account for approximately 42.56% of the portfolio.
To see all holdings, visit the Franklin India Arbitrage Fund Direct Growth Plan page
The largest holding is Franklin India Money Market Fund Direct-Growth Plan ^^ ~~ at 11.01%, which is meaningful but not overwhelming for a fund that holds 46 disclosed positions. The next few positions step down into the mid-single digits, so influence may be distributed rather than resting on one dominant line item.
By the tenth holding, weight has fallen to 2.53%, which shows a fairly clear taper from the lead position to the outer edge of the visible top holdings. That pattern suggests the portfolio is not fully concentrated in only a few securities, even though the top 10 still account for a sizable 42.56% of assets.
Because more than half the disclosed holdings sit outside the top 10, the portfolio likely has a longer tail of smaller positions. That structure could help spread exposure across multiple arbitrage and cash-style instruments, while the largest few holdings may still have greater influence on near-term behaviour.
Source data date: as of 11 Sep 2026
Who should invest
This fund may suit investors with low risk tolerance who want a steadier hybrid allocation rather than a growth-led equity style. The low-risk tag, positive recent returns and ability to stay ahead of the benchmark in weak market conditions point toward a defensive role in a portfolio.
The main trade-off is that the return pattern is likely to remain modest compared with riskier market-linked funds. Investors who need a multi-year holding and are comfortable with subdued upside in exchange for lower volatility may find the profile more relevant than those looking for fast capital appreciation.
Tax and exit load
| Holding period | Tax rate | Description |
|---|---|---|
| Units held less than 1 year | 20% | Short-term capital gains tax |
| Units held more than 1 year | 12.5% | Long-term capital gains tax |
The exit load is nil for 10% of units and 1% for the remaining units on or before 30 days, and there is no exit load after the holding period.
Source data date: as of 11 Sep 2026
Frequently asked questions
What is the current NAV of Franklin India Arbitrage Fund Direct Growth Plan?
The current NAV is ₹11.3039 as of 11 September 2026.
What are the 1-year, 3-year and 5-year returns?
The 1-year return is 6.94%, while the 3-year and 5-year returns are Data not available.
How has the fund done versus the benchmark?
It has held up better than the benchmark over 1 month, 3 months and 1 year. The benchmark is negative across those same periods, while the fund remains positive.
How does it compare with peers on available return data?
Its 1-year return of 6.94% is below Quant Arbitrage Fund Direct Growth Plan and WOC Arbitrage Fund Direct Growth Plan, and close to Motilal Oswal Arbitrage Fund Direct Growth Plan. Among peers with longer-horizon figures available, Invesco India Arbitrage Fund Direct Growth Plan has stronger 3-year and 5-year numbers.
What is the minimum SIP amount?
The minimum SIP amount is ₹500.
Who manages the fund and what is the exit load?
The fund is managed by Mukesh Jain, Rajasa Kakulavarapu, Pallab Roy and Rohan Maru. The exit load is nil for 10% of units and 1% for the remaining units on or before 30 days, and there is no exit load after the holding period.
Bottom line
Franklin India Arbitrage Fund Direct Growth Plan has shown a steadier recent pattern than its benchmark, with positive short-horizon returns even when the benchmark was negative. On the available peer data, its 1-year performance is competitive but not leading, and longer-horizon comparison is constrained because most peers do not carry full 3-year or 5-year figures here. The portfolio is spread across 46 disclosed holdings, with the top 10 accounting for 42.56%, which suggests a balanced but still meaningful core.
Published on 15 September 2026 at 4:31 PM IST
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RIA disclosure
Mutual fund investments are subject to market risks. Read all scheme-related documents carefully before investing. This review is prepared by Uniapps Investment Adviser Pvt. Ltd. (earlier known as Uniapps Global Research Pvt. Ltd.) under SEBI Registered Investment Adviser registration INA000017639 for general informational purposes and is not personalized investment advice.