Three related numbers, one idea
A debt fund reports three duration-ish figures - they move together, but answer slightly different questions:
Real comparison across 6 debt funds
CHART
Duration & Average Maturity - 6 real debt funds
Years. All three rise together, but Modified Duration is the one that directly answers 'how much does this fund's NAV move if rates move 1%.'
Funds compared: Quantum Liquid Fund - Direct Plan - Growth · Canara Robeco Medium to Long Term Fund - Direct Plan - Growth · Canara Robeco Ultra Short to Short Term Fund - Direct Plan - Growth · Canara Robeco Conservative Hybrid Fund - Direct Plan - Growth · Canara Robeco Short Term Fund - Direct Plan - Growth · Bandhan Liquid Fund - Direct Plan - Growth
Reading the spread
Across these 6 funds, modified duration runs from 0.11 yrs (Quantum Liquid Fund - Direct Plan - Growth) to 3.77 yrs (Canara Robeco Medium to Long Term Fund - Direct Plan - Growth), a gap of 3.66 yrs. The middle value is 1.04 yrs, with 3 of 6 above it. The highest reading is 34.3 times the lowest, so the choice of fund changes this number a lot. Neither end is better or worse in itself; the number describes how a fund behaves, and what matters is whether that matches what you want.
How to use it in practice
Duration measures how sensitive a debt fund’s NAV is to a change in interest rates. A modified duration of 3 means that a 1 percentage point rise in rates would lower the NAV by about 3%, and a fall would raise it by about as much. Use it to match a debt fund to your horizon: the longer the duration, the more the NAV swings with rate moves, and the longer you should plan to stay invested.
Common mistakes
Duration is an estimate that works best for small rate changes. It also ignores credit risk entirely, so a short-duration fund can still lose money from a default. And it changes as the fund’s bonds age and as the manager adjusts the portfolio. Read it with yield to maturity and the fund’s Potential Risk Class.
Frequently asked questions
What is the difference between Macaulay and modified duration?
Macaulay duration is the weighted average time to receive a bond’s cash flows, in years. Modified duration adjusts that to show the percentage price change for a 1 percentage point move in yields.
Is a longer duration riskier?
It is more sensitive to interest rate changes, so its NAV can swing more. That risk is rewarded only if rates fall, so match duration to your holding period.
What is average maturity?
It is the weighted average time until the fund’s bonds mature. It is related to duration but ignores the timing of coupon payments.
WHAT THIS MEANS FOR YOU A liquid fund with a duration near zero barely moves when rates change - that’s the point of holding it. A long-duration fund can swing several percent in NAV on a single rate move, in either direction. Pick duration based on your own view of rates and how long you can hold, not just the highest current YTM.
METHODOLOGY All three computed from the fund’s latest disclosed portfolio, holdings-weighted. Data: July-2026 disclosure via Punji. Not investment advice.