The markets have been highly volatile over the past few months owing to different factors such as geopolitical issues, inflation, interest rate changes, slow economic growth, corporate earnings being sluggish, and more. As mutual funds’ performance depends on market performance, the mutual fund industry has become sluggish as well. However, is it applicable to all the funds? The answer is no. As debt funds’ performance remains more or less stable, given the nature of these funds. In this article, we will cover one such debt fund that can help your investment portfolio remain stable to some extent during volatile periods. 

This article will be around DSP Savings Fund – Direct Plan-Growth, which is one such debt fund. We will talk about the performance, risks, objectives, and a lot of other aspects of this fund which as an investor you should know before investing in it. 

DSP Savings Fund Direct-Growth Fund Management and Objectives

DSP Savings Fund Direct-Growth invests in debt and money market instruments for income generation. It invests in the debt securities and money market instruments that have a maturity period of less than equal to one year. Thus, it is categorized as a short-term debt fund.   

DSP Savings Fund Direct Plan-Growth is managed by – 

• Karan Mundhra: He has been managing this fund since May 2021. He has been associated with DSP Mutual Fund for over 13 years and has solid experience in managing debt funds. He holds a CA and a Bachelor’s in Commerce.
• Shalini Vasanta: She has been associated with the fund since August 2024, and before joining DSP Mutual Fund, she was working with ICRA as a senior analyst. She holds a Bachelor’s in Arts and an MBA in Finance. 

Excited about investing in the DSP Savings Fund? Open a free Demat account today!

How Does the DSP Savings Fund Work?

DSP Savings Fund invests in high-quality money market instruments. The fund managers of this fund follow the ‘roll down’ strategy for this fund. So, as the primary instruments in this fund have a maturity of less than one year, the maturity of the fund gets reset every year.   

Performance and Returns (As of 14 July 2025) 

DSP Savings Fund Direct-Growth has been offering a consistent return over time. Here is a snapshot of the returns and comparison with its peers. 

Time Frame	DSP Savings Fund Direct-Growth (%)	Category Average
6 Month	4.13	4.35
3 Month	1.97	2.04
1 Month	0.61	0.62
1 Day	0.05	0.06
YTD	4.36	4.60
1 Year	7.84	8.14
3 Year	7.39	7.51
5 Year	5.85	6.05
7 Year	6.46	6.57
10 Year	6.55	6.89

So, from the above table, it can be understood that the fund has been offering consistent returns over time; however, it is marginally lower than the category average returns.   

Investment Allocation (As of 30 June 2025)

The DSP Savings Fund Growth has 99.52% of debt instruments, and 0.48% is cash and cash equivalents. 

Credit rating-wise asset allocation 

• AAA Rating – 86.3%
• Sovereign Bonds – 12.93%
• Cash equivalent – 0.48%
• Unrated/ others – 0.29%

As of 30 June 2025, the fund had 71 securities. The yield to maturity of the fund is 6.53% and Macaulay Duration is 0.58 years.  

The top five debt holdings of the DSP Savings Fund include – 

Stocks	Assets (%)
GOI Sec 7.59 11/01/2026	6.33
Small Industries Development Bank of India Ltd. CD 20/05/2026	4.61
IDFC First Bank Ltd. CD 22/05/2026	4.09
HDFC Bank Ltd. CD 19/05/2026	3.58
Bharti Telecom Ltd. CP 360-D 17/10/2025	3.29

Key Metrics 

As of 30 June 2025, the fund had an expense ratio of 0.16%, which is marginally lower than the category average of 0.17%.

Fund Details	Information
AUM (Assets Under Management)	₹4623 Crore as of 30 June 2025
Category	Debt Fund, open-ended
Fund Manager	Karan Mundhra, Shalini Vasanta
Exit Load	Nil
Entry Load	Nil
Minimum Investment	₹100 (Lump sum)₹100 (SIP)
Benchmark	CRISIL Money Market A-I Index

The DSP Savings Fund NAV as of 14 July 2025 stood at ₹54.5072.  

Risk and Performance of the DSP Savings Fund 

This fund is classified as a ‘Low to Moderately Risky’ fund. It usually offers a stable return which comes with nominal risk. 

1. Standard Deviation (Std Dev% %): It shows how much the returns vary from the average returns generated by the funds themselves. The higher this number, the more it fluctuates.

The Standard deviation for the fund is 0.32%, while that of the category is a little higher at 0.51%, making the fund’s returns less fluctuating.

2. Beta: This ratio indicates the volatility of the fund’s performance, compared to similar funds in the market. The lower the Beta, the more predictable the returns are, and vice versa. It helps in comparing funds. 

The fund has 0.78% as beta, while that of the category is 1.12%, again depicting lower volatility for the fund compared to the peers. 

3. Sharpe Ratio: This ratio indicates the return you get for the risk you’re taking. A higher number means better risk-adjusted returns.

The fund’s Sharpe ratio is 2.60% while the category average is 0.95, making the fund offer way higher risk-adjusted returns.

4. Sortino Ratio: It is similar to Sharpe but only looks at downside risk (the risk of losing money

The fund has 3.61% while the category average is 1.14%, offering higher downside risk-adjusted profits 

5. Alpha: It measures the extra return the fund gives above the market’s average return.

The fund has 2.29%, and the category average is 2.84%, indicating that the fund offers a little lower than its peers. 

Taxation for DSP Savings Fund 

If you’re investing in the DSP Savings Fund, here’s how your returns will be taxed:

• If you have purchased the fund units on or after 1 April 2023, then the entire amount you generate from the fund as profit will be taxed according to your income slab rate. 
• If the fund units were purchased before 1 April 2023, then in case you have been selling the units within 2 years of the date of investment, gains will be added to the income and taxed as per the slab. However, if you are selling the units after 2 years of investment, then the tax rate will be 12.5% on the profits. 
• In case of dividend income, it will be taxed as per the slab. If dividend income exceeds ₹10000 in a financial year, then the fund house charges a TDS of 10% before distributing the dividends.

Minimum Investment and Lock-in Period

The minimum investment amount in the DSP Savings Fund is ₹100 for lump sum and SIP, which is ₹100. There is no lock-in period for the DSP Savings Fund Direct-Growth.

How to Invest in DSP Savings Fund Direct?

You can invest in the DSP Savings Fund – Direct Growth plan with Shoonya. 

Shoonya offers a free Demat account,  Zero brokerage trading, advanced trading tools, 100+ technical indicators, and much more!

Investing in Lump Sum Mutual Funds through the Shoonya Web Platform

Here’s a quick guide on how to invest in lump sum mutual funds through the Shoonya web platform:

1. First, you must log in to your Shoonya account at https://trade.shoonya.com/ From the “Orders” section, click on “MF order.”
2. Search for the fund you wish to invest in; in this case, the DSP Savings Fund – Direct Growth plan.
3. Choose “Fresh” for a new investment and enter the amount you want to invest.
4. You can complete your purchase by clicking the “Purchase” button.
5. You will receive a payment link on your registered email. Use the link to make the payment.

After payment, your mutual fund units will be allotted to your Demat account within T+2 days.

Note: You can only make the payment using the bank account registered with your Demat account.

Setting Up an SIP for Mutual Funds

If you prefer a Systematic Investment Plan (SIP) for DSP Savings Fund Direct Plan-Growth plan, you must follow these steps:

1. First, you need to log in to your Shoonya account at https://trade.shoonya.com/ Go to “Orders” and click on “XSIP.”
2. Find the mutual fund for which you want to set up an SIP. In this case, the DSP Savings Fund – Direct Growth plan.
3. If this is your first SIP with Shoonya, you need to create a Mandate ID. 

For that, you must enter the mandate amount and the validity date (until you want to keep your SIP active).

4. You must submit the details, and you’ll receive a Mandate authentication link via email. Approval generally takes 24 hours.

Once your Mandate is approved, you can follow these steps to set up your SIP:

1. Go to “XSIP,” enter the SIP amount, and select “Fresh” as the transaction type.
2. Choose the date when the SIP will be debited directly from your registered bank.
3. The approved Mandate ID will auto-reflect.
4. Choose “Monthly” for monthly debits and specify the number of installments (e.g., 24 installments for a 2-year SIP).

If you do not want to forget your SIPs and invest systematically, the SIP method can be most suitable for you. 

Why Invest in the DSP Savings Fund?

The reasons for investing in the DSP Savings Fund Direct-Growth can be – 

• Regular Income generation 
• Stability in returns 
• Well-diversified portfolio helps mitigate risks

Suitability of this Fund| Who Should Invest?

The DSP Savings Fund Direct is suitable for investors who:

• Are conservative investors 
• Looking for regular income
• Looking for short-term investment vehicles to park funds

Conclusion

So, DSP Savings Fund can offer income from investments, and stability of returns. Anyone who is a conservative investor, this debt funds can be a good choice. The performance of the fund also has been stable, and consistent, though bit lower than the industry and risk quotient is quite low. 

DSP Savings Fund Direct Plan-Growth | FAQs

Source: ValueResearch

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Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.