Liquid Funds

What are Liquid Funds?

Cash Management Funds are also known as liquid funds. Liquid Funds are debt funds which invest in securities with a residual maturity upto 91 days such as Certificate of Deposit (CD), Commercial Paper (CP), Treasury Bills (T-bills). They aim at providing a high degree of liquidity to investors and are considered one of the safest funds among mutual fund categories.

Why invest in Liquid Funds?

  • High liquidity: Investors can choose to redeem their investments whenever they want.
  • Low risk: Owing to the short term nature of the underlying securities, liquid funds have one of the lowest interest rate risks as compared to other debt funds.
  • Easy redemption: Liquid mutual funds are highly liquid and can be easily redeemed. Redemption requests are usually processed within one working day
  • Potential for better returns: Liquid funds have the potential to generate better returns than savings account.
  • Flexibility: Liquid funds have the flexibility of Systematic Investment Plan(SIP), Systematic Withdrawal Plan(SWP) , Systematic Transfer Plan(STP).

Why invest in Liquid Funds?

withdraw

High liquidity

Investors can choose to redeem their investments whenever they want.
risk

Low Risk

Owing to the short term nature of the underlying securities, liquid funds have one of the lowest interest rate risks as compared to other debt funds.
redemption

Easy Redemption

Liquid Mutual Funds are highly liquid and can be easily redeemed. Redemption requests are usually processed within one working day.
save-money

Potential for Better Returns

Liquid funds have the potential to generate better returns than savings account.
payment

Flexibility

Liquid funds have the flexibility of Systematic Investment Plan(SIP), Systematic Withdrawal Plan(SWP) , Systematic Transfer Plan(STP).

Liquid Funds are primarily used to park surplus funds for short periods of time. Also Suitable for putting money aside for emergencies.