Kotak Arbitrage Fund leads arbitrage mutual funds in three-year CAGR returns; delivers 7.0% gain
Kotak Arbitrage Fund delivered 7.0% CAGR returns over three years and 5.9% CAGR over the last one year, according to ACE MF data on June 29.
Moneycontrol Desk
June 30, 2026 / 10:55 IST
Among arbitrage mutual funds that meet the screen used for this ranking, Kotak Arbitrage Fund is at the top on three-year CAGR returns. The fund delivered 7.0 percent, ahead of UTI Arbitrage Fund at 6.9 percent and Invesco India Arbitrage Fund at 6.9 percent, according to ACE MF data on June 29.
The ranking considers only schemes with assets under management of at least Rs 1,500 crore. Among the top five funds that meet this criterion, Kotak Arbitrage Fund has the largest corpus at Rs 72,079.2 crore.
The benchmark comparison is also important. Kotak Arbitrage Fund trailed its benchmark by 0.5 percentage points on a three-year basis, with the benchmark returning 7.5%. It was also trailed its benchmark by 1.1 percentage points on a one-year basis, with the benchmark returning 6.9%.
The leadership shifts in the one-month comparison, where UTI Arbitrage Fund tops the list with 1.0 percent.
A different fund moves to the top when the three-month window is used. HDFC Arbitrage Fund leads this comparison with 1.5 percent.
The leadership shifts in the one-year comparison, where UTI Arbitrage Fund tops the list with 5.9 percent.
Return rankings across mutual funds can shift when the comparison window changes. This makes it useful to read the headline return along with shorter and longer return periods.
Table: Top 5 arbitrage funds by three-year CAGR return
| Fund name | 3-year return (%) | AUM (Rs crore) | 1-month return (%) | 3-month return (%) | 6-month return (%) | 1-year return (%) |
|---|---|---|---|---|---|---|
| Kotak Arbitrage Fund | 7.0 | 72,079.2 | 0.9 | 1.4 | 3.0 | 5.9 |
| UTI Arbitrage Fund | 6.9 | 10,990.9 | 1.0 | 1.4 | 3.0 | 5.9 |
| Invesco India Arbitrage Fund | 6.9 | 28,062.4 | 0.9 | 1.4 | 2.9 | 5.9 |
| HDFC Arbitrage Fund | 6.9 | 25,084.9 | 1.0 | 1.5 | 3.0 | 5.9 |
| ICICI Pru Arbitrage Fund | 6.9 | 32,260.2 | 1.0 | 1.4 | 3.0 | 5.9 |
Note: The ranking considers only schemes with minimum assets under management of Rs 1,500 crore. Returns and AUM are according to ACE MF data on June 29. One-year and three-year returns are CAGR; one-month, three-month and six-month returns are absolute returns. AUM is in Rs crore.
What is an arbitrage fund?
Arbitrage funds seek to capture price differences between cash and derivatives markets. Their returns can vary with arbitrage spreads and market liquidity.