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6 Best Liquid Mutual Funds 2022
In common terms, Best Liquid Funds are Debt Mutual Funds or rather money market Mutual Funds with the only difference being in the investment duration. Liquid Funds invest in very short money Market instruments like the Certificate of Deposit, treasury bills, commercial papers etc.
The investment duration of these funds is very short, generally ranging from a couple of days to a few weeks (it can even be one day!). The average residual maturity of liquid funds is less than 91 days as they invest in securities which individually have a maturity upto 91 days. Being a short-term Debt fund, these funds are highly suitable for investors looking for low-risk investments for short duration.
The low maturity period of best liquid funds helps fund managers to fulfil the Redemption demand of investors easily. In the market, there are various liquid fund investments available.
Why Invest in Liquid Funds?
- Liquid funds have no lock-in or very low lock-in period.
- The interest rate of liquid mutual funds is the lowest among all short-term investments due to low maturity period.
- No entry and exit loads are applicable.
- Liquid funds are a perfect solution for investors who wish to park their idle cash for a short duration without the risk of Capital Loss.
Liquid Funds better than Saving Bank Account?
Investing in liquid funds are any day a better option on investment as compared to putting money in popular saving Bank account schemes.
Owing to its familiarity and institutionalized nature of saving bank accounts, an average Indian taxpayer has more trust in them. However, it seems they are not the most popular short-term investment anymore. This is due to the rising acceptance of mutual funds by investors with different investment goals. Your hard earned money that lies in a savings bank account fetches you only 3.5% interest per annum. However, the best liquid funds have returned as high as 6.5-7.5% on an average in the past 1 year period, on an annualized Basis.
So, on returns alone, liquid funds score over a savings bank account. If you have a raise or a bonus coming your way, invest in liquid funds and party later.
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6 Best Liquid Funds India FY 22 - 23
Fund NAV Net Assets (Cr) 1 MO (%) 3 MO (%) 6 MO (%) 1 YR (%) 2021 (%) Debt Yield (YTM) Mod. Duration Eff. Maturity Axis Liquid Fund Growth ₹2,361.02
↑ 0.32 ₹28,934 0.3 0.9 1.8 3.4 3.3 3.88% 1M 12D 1M 13D UTI Liquid Cash Plan Growth ₹3,482.89
↑ 0.45 ₹30,885 0.3 0.9 1.7 3.4 3.3 4.04% 1M 6D 1M 6D SBI Liquid Fund Growth ₹3,325.69
↑ 0.43 ₹57,937 0.3 0.8 1.7 3.4 3.3 4.05% 1M 10D 1M 10D Aditya Birla Sun Life Liquid Fund Growth ₹341.951
↑ 0.04 ₹32,899 0.2 0.8 1.7 3.4 3.3 4.15% 1M 13D 1M 13D IDFC Cash Fund Growth ₹2,568.68
↑ 0.30 ₹11,630 0.3 0.9 1.7 3.4 3.2 4% 1M 5D 1M 5D Kotak Liquid Fund Growth ₹4,298.42
↑ 0.51 ₹30,230 0.3 0.8 1.7 3.4 3.2 4.06% 1M 6D 1M 6D Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 May 22 Liquid funds having AUM/Net Assets above 10,000 Crore and managing funds for 5 or more years. Sorted on Last 1 Calendar Year Return.
To provide a high level of liquidity with reasonable returns commensurating with low risk through a portfolio of money market and debt securities. However there can be no assurance that the investment objective of the scheme will be achieved. Axis Liquid Fund is a Debt - Liquid Fund fund was launched on 9 Oct 09. It is a fund with Low risk and has given a Below is the key information for Axis Liquid Fund Returns up to 1 year are on The investment objective of the scheme is to generate steady and reasonable income, with low risk and high level of liquidity from a portfolio of money market securities and high quality debt. UTI Liquid Cash Plan is a Debt - Liquid Fund fund was launched on 11 Dec 03. It is a fund with Low risk and has given a Below is the key information for UTI Liquid Cash Plan Returns up to 1 year are on (Erstwhile SBI - Premier Liquid Fund) To provide attractive returns to the Magnum/Unit holders either through
periodic dividends or through capital appreciation through an actively
managed portfolio of debt and money market instruments. Income may be
generated through the receipt of coupon payments, the amortization of the
discount on the debt instruments, receipt of dividends or purchase and sale of
securities in the underlying portfolio. SBI Liquid Fund is a Debt - Liquid Fund fund was launched on 22 Mar 07. It is a fund with Low risk and has given a Below is the key information for SBI Liquid Fund Returns up to 1 year are on (Erstwhile Aditya Birla Sun Life Cash Plus Fund) An Open-ended liquid scheme with the objective to provide reasonable returns at a high level of safety and liquidity through judicious investments in high quality debt and money market instruments. Aditya Birla Sun Life Liquid Fund is a Debt - Liquid Fund fund was launched on 30 Mar 04. It is a fund with Low risk and has given a Below is the key information for Aditya Birla Sun Life Liquid Fund Returns up to 1 year are on To generate optimal returns with high liquidity by investing in high quality money market and debt instruments. However there is no assurance that the investment objective of the scheme will be realized. IDFC Cash Fund is a Debt - Liquid Fund fund was launched on 4 Jun 08. It is a fund with Low risk and has given a Below is the key information for IDFC Cash Fund Returns up to 1 year are on Aims to provide reasonable returns and high level of liquidity by investing in debt instruments such as bonds, debentures, Government Securities, money market instruments such as treasury bills, commercial paper, certificate of deposit, including repos in permitted securities of different maturities so as to spread the risk across different kinds of issuers in the debt markets. Kotak Liquid Fund is a Debt - Liquid Fund fund was launched on 4 Nov 03. It is a fund with Low risk and has given a Below is the key information for Kotak Liquid Fund Returns up to 1 year are on 1. Axis Liquid Fund
CAGR/Annualized return of 7% since its launch. Ranked 21 in Liquid Fund category. Return for 2021 was 3.3% , 2020 was 4.3% and 2019 was 6.6% . Axis Liquid Fund
Growth Launch Date 9 Oct 09 NAV (20 May 22) ₹2,361.02 ↑ 0.32 (0.01 %) Net Assets (Cr) ₹28,934 on 30 Apr 22 Category Debt - Liquid Fund AMC Axis Asset Management Company Limited Rating ☆☆☆☆ Risk Low Expense Ratio 0.23 Sharpe Ratio -1.99 Information Ratio 0 Alpha Ratio 0 Min Investment 500 Min SIP Investment 1,000 Exit Load NIL Yield to Maturity 3.88% Effective Maturity 1 Month 13 Days Modified Duration 1 Month 12 Days Growth of 10,000 investment over the years.
Date Value 30 Apr 17 ₹10,000 30 Apr 18 ₹10,686 30 Apr 19 ₹11,490 30 Apr 20 ₹12,191 30 Apr 21 ₹12,605 30 Apr 22 ₹13,038 Returns for Axis Liquid Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22 Duration Returns 1 Month 0.3% 3 Month 0.9% 6 Month 1.8% 1 Year 3.4% 3 Year 4.2% 5 Year 5.4% 10 Year 15 Year Since launch 7% Historical performance (Yearly) on absolute basis
Year Returns 2021 3.3% 2020 4.3% 2019 6.6% 2018 7.5% 2017 6.7% 2016 7.6% 2015 8.4% 2014 9.1% 2013 9.2% 2012 9.7% Fund Manager information for Axis Liquid Fund
Name Since Tenure Devang Shah 5 Nov 12 9.49 Yr. Aditya Pagaria 13 Aug 16 5.72 Yr. Data below for Axis Liquid Fund as on 30 Apr 22
Asset Allocation
Asset Class Value Cash 100% Debt Sector Allocation
Sector Value Cash Equivalent 62.28% Corporate 23.07% Government 14.65% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity 91 Dtb 07072022
Sovereign Bonds | -3% ₹993 Cr 100,000,000 91 Dtb 23062022
Sovereign Bonds | -3% ₹796 Cr 80,000,000 India (Republic of)
Sovereign Bonds | -2% ₹694 Cr 70,000,000
↑ 70,000,000 91 Dtb 13072022
Sovereign Bonds | -2% ₹675 Cr 68,000,000
↑ 18,000,000 National Bank For Agriculture And Rural Development
Debentures | -1% ₹261 Cr 2,600 L&T Metro Rail (Hyderabad) Limited
Debentures | -1% ₹250 Cr 5,000 91 Dtb 02062022
Sovereign Bonds | -1% ₹249 Cr 25,000,000 91 Dtb 26052022
Sovereign Bonds | -1% ₹234 Cr 23,500,000 91 Dtb 12052022
Sovereign Bonds | -1% ₹200 Cr 20,000,000 Bajaj Finance Ltd
Debentures | -1% ₹198 Cr 4,000
↑ 4,000 2. UTI Liquid Cash Plan
CAGR/Annualized return of 6.9% since its launch. Ranked 32 in Liquid Fund category. Return for 2021 was 3.3% , 2020 was 4.2% and 2019 was 6.6% . UTI Liquid Cash Plan
Growth Launch Date 11 Dec 03 NAV (20 May 22) ₹3,482.89 ↑ 0.45 (0.01 %) Net Assets (Cr) ₹30,885 on 30 Apr 22 Category Debt - Liquid Fund AMC UTI Asset Management Company Ltd Rating ☆☆☆ Risk Low Expense Ratio 0.25 Sharpe Ratio -2.49 Information Ratio -5.15 Alpha Ratio -0.28 Min Investment 500 Min SIP Investment 1,500 Exit Load NIL Yield to Maturity 4.04% Effective Maturity 1 Month 6 Days Modified Duration 1 Month 6 Days Growth of 10,000 investment over the years.
Date Value 30 Apr 17 ₹10,000 30 Apr 18 ₹10,682 30 Apr 19 ₹11,485 30 Apr 20 ₹12,172 30 Apr 21 ₹12,587 30 Apr 22 ₹13,017 Returns for UTI Liquid Cash Plan
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22 Duration Returns 1 Month 0.3% 3 Month 0.9% 6 Month 1.7% 1 Year 3.4% 3 Year 4.2% 5 Year 5.4% 10 Year 15 Year Since launch 6.9% Historical performance (Yearly) on absolute basis
Year Returns 2021 3.3% 2020 4.2% 2019 6.6% 2018 7.4% 2017 6.7% 2016 7.7% 2015 8.3% 2014 9.1% 2013 9.1% 2012 9.6% Fund Manager information for UTI Liquid Cash Plan
Name Since Tenure Amandeep Chopra 14 Dec 06 15.39 Yr. Amit Sharma 7 Jul 17 4.82 Yr. Data below for UTI Liquid Cash Plan as on 30 Apr 22
Asset Allocation
Asset Class Value Cash 100% Debt Sector Allocation
Sector Value Cash Equivalent 76.75% Government 13.24% Corporate 10.01% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity 91 Dtb 30062022
Sovereign Bonds | -4% ₹1,488 Cr 15,000,000,000 364 DTB 02062022
Sovereign Bonds | -3% ₹995 Cr 10,000,000,000 8.15% Govt Stock 2022
Sovereign Bonds | -2% ₹710 Cr 7,050,000,000 91 Dtb 09062022
Sovereign Bonds | -2% ₹686 Cr 6,900,000,000 8.35% Govt Stock 2022
Sovereign Bonds | -2% ₹592 Cr 5,900,000,000 91 Dtb 02062022
Sovereign Bonds | -2% ₹547 Cr 5,500,000,000 91 Dtb 28042022
Sovereign Bonds | -1% ₹499 Cr 5,000,000,000 91 Dtb 26052022
Sovereign Bonds | -1% ₹498 Cr 5,000,000,000 04.54 MH Sdl 2022
Sovereign Bonds | -1% ₹363 Cr 3,629,940,000 04.45 MH Sdl 2022
Sovereign Bonds | -1% ₹300 Cr 3,000,000,000 3. SBI Liquid Fund
CAGR/Annualized return of 6.9% since its launch. Ranked 40 in Liquid Fund category. Return for 2021 was 3.3% , 2020 was 4.2% and 2019 was 6.5% . SBI Liquid Fund
Growth Launch Date 22 Mar 07 NAV (20 May 22) ₹3,325.69 ↑ 0.43 (0.01 %) Net Assets (Cr) ₹57,937 on 15 May 22 Category Debt - Liquid Fund AMC SBI Funds Management Private Limited Rating ☆☆☆ Risk Low Expense Ratio 0.26 Sharpe Ratio -2.44 Information Ratio 0 Alpha Ratio 0 Min Investment 50,000 Min SIP Investment 500 Exit Load NIL Yield to Maturity 4.05% Effective Maturity 1 Month 10 Days Modified Duration 1 Month 10 Days Growth of 10,000 investment over the years.
Date Value 30 Apr 17 ₹10,000 30 Apr 18 ₹10,671 30 Apr 19 ₹11,460 30 Apr 20 ₹12,138 30 Apr 21 ₹12,549 30 Apr 22 ₹12,975 Returns for SBI Liquid Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22 Duration Returns 1 Month 0.3% 3 Month 0.8% 6 Month 1.7% 1 Year 3.4% 3 Year 4.1% 5 Year 5.3% 10 Year 15 Year Since launch 6.9% Historical performance (Yearly) on absolute basis
Year Returns 2021 3.3% 2020 4.2% 2019 6.5% 2018 7.3% 2017 6.6% 2016 7.6% 2015 8.3% 2014 9% 2013 9.2% 2012 9.6% Fund Manager information for SBI Liquid Fund
Name Since Tenure R. Arun 7 May 18 3.98 Yr. Data below for SBI Liquid Fund as on 15 May 22
Asset Allocation
Asset Class Value Cash 94.98% Debt 5.02% Debt Sector Allocation
Sector Value Cash Equivalent 78.98% Corporate 10.58% Government 5.42% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity Hdfc Bank Ltd.
- | -5% ₹2,975 Cr 01
↑ 01 91 Dtb 13072022
Sovereign Bonds | -4% ₹2,476 Cr 250,000,000
↑ 250,000,000 91 Dtb 23062022
Sovereign Bonds | -4% ₹2,284 Cr 230,000,000 364 DTB 05052022
Sovereign Bonds | -3% ₹1,996 Cr 200,000,000 91 Dtb 16062022
Sovereign Bonds | -3% ₹1,831 Cr 184,329,800 8.15% Govt Stock 2022
Sovereign Bonds | -3% ₹1,761 Cr 175,000,000 91 Dtb 30062022
Sovereign Bonds | -3% ₹1,488 Cr 150,000,000 8.35% Govt Stock 2022
Sovereign Bonds | -1% ₹637 Cr 63,500,000 Sundaram Finance Limited
Debentures | -1% ₹500 Cr 5,000 IDFC First Bank Limited
Debentures | -1% ₹498 Cr 10,000 4. Aditya Birla Sun Life Liquid Fund
CAGR/Annualized return of 7% since its launch. Ranked 15 in Liquid Fund category. Return for 2021 was 3.3% , 2020 was 4.3% and 2019 was 6.7% . Aditya Birla Sun Life Liquid Fund
Growth Launch Date 30 Mar 04 NAV (20 May 22) ₹341.951 ↑ 0.04 (0.01 %) Net Assets (Cr) ₹32,899 on 15 May 22 Category Debt - Liquid Fund AMC Birla Sun Life Asset Management Co Ltd Rating ☆☆☆☆ Risk Low Expense Ratio 0.31 Sharpe Ratio -2.11 Information Ratio -3.8 Alpha Ratio -0.31 Min Investment 5,000 Min SIP Investment 500 Exit Load NIL Yield to Maturity 4.15% Effective Maturity 1 Month 13 Days Modified Duration 1 Month 13 Days Growth of 10,000 investment over the years.
Date Value 30 Apr 17 ₹10,000 30 Apr 18 ₹10,687 30 Apr 19 ₹11,486 30 Apr 20 ₹12,186 30 Apr 21 ₹12,609 30 Apr 22 ₹13,040 Returns for Aditya Birla Sun Life Liquid Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22 Duration Returns 1 Month 0.2% 3 Month 0.8% 6 Month 1.7% 1 Year 3.4% 3 Year 4.2% 5 Year 5.4% 10 Year 15 Year Since launch 7% Historical performance (Yearly) on absolute basis
Year Returns 2021 3.3% 2020 4.3% 2019 6.7% 2018 7.4% 2017 6.7% 2016 7.7% 2015 8.4% 2014 9.2% 2013 9.3% 2012 9.7% Fund Manager information for Aditya Birla Sun Life Liquid Fund
Name Since Tenure Sunaina Cunha 15 Jul 11 10.8 Yr. Kaustubh Gupta 15 Jul 11 10.8 Yr. Harshil Suvarnkar 9 Jun 21 0.89 Yr. Data below for Aditya Birla Sun Life Liquid Fund as on 15 May 22
Asset Allocation
Asset Class Value Cash 100% Debt Sector Allocation
Sector Value Cash Equivalent 75.24% Corporate 19.74% Government 5.01% Credit Quality
Rating Value AA 0.16% AAA 99.84% Top Securities Holdings / Portfolio
Name Holding Value Quantity 91 Dtb 13072022
Sovereign Bonds | -5% ₹1,672 Cr 168,500,000
↑ 43,500,000 182 Dtb 21072022
Sovereign Bonds | -2% ₹853 Cr 86,000,000
↑ 86,000,000 Bajaj Finance Ltd
Debentures | -2% ₹743 Cr 15,000
↑ 15,000 8.15% Govt Stock 2022
Sovereign Bonds | -1% ₹507 Cr 50,500,000
↑ 50,500,000 Mahindra & Mahindra Financial Services Limited
Debentures | -1% ₹495 Cr 10,000
↑ 10,000 India (Republic of)
Sovereign Bonds | -1% ₹476 Cr 48,011,100
↑ 48,011,100 364 Dtb 26052022
Sovereign Bonds | -1% ₹449 Cr 45,000,000
↓ -30,000,000 LIC Housing Finance Limited
Debentures | -1% ₹372 Cr 3,700 8.35% Govt Stock 2022
Sovereign Bonds | -1% ₹295 Cr 29,500,000 India (Republic of)
Sovereign Bonds | -1% ₹248 Cr 25,000,000
↑ 25,000,000 5. IDFC Cash Fund
CAGR/Annualized return of 7% since its launch. Ranked 26 in Liquid Fund category. Return for 2021 was 3.2% , 2020 was 4% and 2019 was 6.3% . IDFC Cash Fund
Growth Launch Date 4 Jun 08 NAV (20 May 22) ₹2,568.68 ↑ 0.30 (0.01 %) Net Assets (Cr) ₹11,630 on 15 May 22 Category Debt - Liquid Fund AMC IDFC Asset Management Company Limited Rating ☆☆☆ Risk Low Expense Ratio 0.18 Sharpe Ratio -3.06 Information Ratio 0 Alpha Ratio 0 Min Investment 100 Min SIP Investment 100 Exit Load NIL Yield to Maturity 4% Effective Maturity 1 Month 5 Days Modified Duration 1 Month 5 Days Growth of 10,000 investment over the years.
Date Value 30 Apr 17 ₹10,000 30 Apr 18 ₹10,679 30 Apr 19 ₹11,462 30 Apr 20 ₹12,122 30 Apr 21 ₹12,520 30 Apr 22 ₹12,946 Returns for IDFC Cash Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22 Duration Returns 1 Month 0.3% 3 Month 0.9% 6 Month 1.7% 1 Year 3.4% 3 Year 4.1% 5 Year 5.3% 10 Year 15 Year Since launch 7% Historical performance (Yearly) on absolute basis
Year Returns 2021 3.2% 2020 4% 2019 6.3% 2018 7.3% 2017 6.6% 2016 7.6% 2015 8.4% 2014 9.1% 2013 9.2% 2012 9.6% Fund Manager information for IDFC Cash Fund
Name Since Tenure Harshal Joshi 15 Sep 15 6.63 Yr. Brijesh Shah 1 Dec 21 0.41 Yr. Data below for IDFC Cash Fund as on 15 May 22
Asset Allocation
Asset Class Value Cash 100% Debt Sector Allocation
Sector Value Cash Equivalent 79.34% Corporate 15.63% Government 5.03% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity 91 Dtb 09062022
Sovereign Bonds | -8% ₹921 Cr 92,500,000 91 Dtb 16062022
Sovereign Bonds | -6% ₹707 Cr 71,000,000 8.35% Govt Stock 2022
Sovereign Bonds | -5% ₹551 Cr 55,000,000
↑ 55,000,000 91 Dtb 30062022
Sovereign Bonds | -4% ₹477 Cr 48,000,000
↑ 10,000,000 Bajaj Finance Limited
Debentures | -3% ₹336 Cr 33,500,000
↑ 16,000,000 8.15% Govt Stock 2022
Sovereign Bonds | -2% ₹251 Cr 25,000,000 National Bank For Agriculture And Rural Development
Debentures | -1% ₹175 Cr 17,500,000 Larsen And Toubro Limited
Debentures | -1% ₹145 Cr 14,430,000 Housing Development Finance Corporation Ltd
Debentures | -1% ₹126 Cr 12,500,000
↑ 12,500,000 Hdb Financial Services Limited
Debentures | -1% ₹116 Cr 11,500,000 6. Kotak Liquid Fund
CAGR/Annualized return of 6.9% since its launch. Ranked 33 in Liquid Fund category. Return for 2021 was 3.2% , 2020 was 4.1% and 2019 was 6.5% . Kotak Liquid Fund
Growth Launch Date 4 Nov 03 NAV (20 May 22) ₹4,298.42 ↑ 0.51 (0.01 %) Net Assets (Cr) ₹30,230 on 30 Apr 22 Category Debt - Liquid Fund AMC Kotak Mahindra Asset Management Co Ltd Rating ☆☆☆ Risk Low Expense Ratio 0.23 Sharpe Ratio -2.79 Information Ratio 0 Alpha Ratio 0 Min Investment 5,000 Min SIP Investment 1,000 Exit Load NIL Yield to Maturity 4.06% Effective Maturity 1 Month 6 Days Modified Duration 1 Month 6 Days Growth of 10,000 investment over the years.
Date Value 30 Apr 17 ₹10,000 30 Apr 18 ₹10,676 30 Apr 19 ₹11,474 30 Apr 20 ₹12,146 30 Apr 21 ₹12,554 30 Apr 22 ₹12,975 Returns for Kotak Liquid Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 May 22 Duration Returns 1 Month 0.3% 3 Month 0.8% 6 Month 1.7% 1 Year 3.4% 3 Year 4.1% 5 Year 5.3% 10 Year 15 Year Since launch 6.9% Historical performance (Yearly) on absolute basis
Year Returns 2021 3.2% 2020 4.1% 2019 6.5% 2018 7.4% 2017 6.7% 2016 7.6% 2015 8.3% 2014 9.1% 2013 9.2% 2012 9.7% Fund Manager information for Kotak Liquid Fund
Name Since Tenure Deepak Agrawal 11 Jul 07 14.81 Yr. Data below for Kotak Liquid Fund as on 30 Apr 22
Asset Allocation
Asset Class Value Cash 100% Debt Sector Allocation
Sector Value Cash Equivalent 74.49% Corporate 20.97% Government 4.54% Credit Quality
Rating Value AAA 100% Top Securities Holdings / Portfolio
Name Holding Value Quantity 8.15% Govt Stock 2022
Sovereign Bonds | -8% ₹2,295 Cr 228,500,000 India (Republic of)
Sovereign Bonds | -4% ₹1,239 Cr 125,000,000
↑ 125,000,000 Housing Development Finance Corporation Ltd
Debentures | -3% ₹976 Cr 9,750 364 DTB 16062022
Sovereign Bonds | -2% ₹746 Cr 75,000,000 8.35% Govt Stock 2022
Sovereign Bonds | -2% ₹701 Cr 70,000,000
↓ -52,000,000 364 Dtb 09062022
Sovereign Bonds | -2% ₹548 Cr 55,000,000 91 Dtb 23062022
Sovereign Bonds | -2% ₹527 Cr 53,000,000 Cholamandalam Investment & Finance Company Limited
Debentures | -2% ₹496 Cr 10,000
↑ 10,000 91 Dtb 26052022
Sovereign Bonds | -1% ₹394 Cr 39,500,000
↓ -37,500,000 364 Dtb 26052022
Sovereign Bonds | -1% ₹349 Cr 35,000,000
↓ -65,000,000
How to evaluate Liquid Mutual Funds?
When looking for a liquid mutual fund, the past return should not be the only Factor for consideration. Other factors like fund size, track record, credit quality of Underlying securities should also be kept in mind.
1. Investment Plans
Liquid funds come with different plans like a daily dividend plan, weekly dividend plan, monthly dividend plan and growth plans. In the growth option, profits made by the scheme are invested back into it. This results in the NAV (Net Asset Value) of the scheme rising over time. In the dividend option, the profits made by the fund are not re-invested. Dividends are distributed to the investor from time to time. Investors can choose their plan as per their convenience and liquidity needs.
2. Expense Ratio
Mutual funds charge a fee to manage your funds called an expense ratio. As per SEBI norms, the upper limit of expense ratio is 2.25%. In case of liquid funds, they maintain a lower expense ratio to provide relatively higher returns over a short period of time.
3. Investment Horizon
Plan your investment horizon. Liquid funds are exclusively meant to invest surplus cash over a very short period of time that is for 91 days. So, if you have an idle cash, you can invest here for a short period and earn better returns than bank Savings Account. In case you have a longer investment horizon of up to 1 year, then you may consider investing in short duration funds to get relatively higher returns.
Features of Liquid Mutual Funds
1. Exit Load Of Liquid Mutual Funds
Considering the fact that liquid mutual funds are short-term investments with a low maturity period, the majority of the funds under this category do not levy any exit load on redemption. Also, if there exists any exit load, it is very nominal and usually not more than a week. Liquid funds generally do not have an exit load given they are very short investment products.
2. Volatility Of Liquid Fund Investment
Generally, the volatility of liquid funds is low as the investment lasts for a few days to weeks. So, the risk of loss in investment is quite less. However, it is suggested to make a liquid fund investment considering the market condition to avoid the opportunity of loss.
3. Lock-in Period Of Best Liquid Funds
Given that liquid mutual funds are very short-term investment options, liquid funds do not have any lock-in period. Liquid Funds can be invested for a time period as short as one day going upto a couple of weeks.
4. Liquid Fund Returns
Liquid funds are one of the best short-term investments during a high Inflation period. In the high inflation period, the interest rate on the liquid fund is high. Thus, helping liquid mutual funds to earn good returns. The liquid fund returns are usually higher than that of other traditional investments like bank fixed deposits or savings accounts. However, it is suggested to invest in best liquid funds choosing a right option (growth, dividend payout, dividend re-investment) suiting your needs.
5. Liquid Funds Taxation
Generally, liquid fund returns receive in the form of dividends are not taxed in the hands of investors. However, a Dividend Distribution Tax (DDT) of approximately 28% is deducted by the mutual fund company from the dividends. Moreover, for the investors who have opted for growth option, a short-term Capital Gain tax is deducted as per the individual’s tax slab. This tax Deduction is same as that of a savings account.
How to Invest in Liquid Funds Online?
Open Free Investment Account for Lifetime at Fincash.com
Complete your Registration and KYC Process
Upload Documents (PAN, Aadhaar, etc.). And, You are Ready to Invest!
Due to the lack of awareness about liquid funds, people don’t invest in them and instead keep huge sums in a savings account. But, it’s never too late to begin something good. So, invest in best liquid funds today!
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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