fincash logo SOLUTIONS
EXPLORE FUNDS
CALCULATORS
fincash number+91-22-62820123
6 Best Performing Liquid Mutual Funds 2018 - 2019 - Fincash.com

Fincash » Mutual Funds » Best Liquid Funds

Best Liquid Mutual Funds 2018 - 2019

Updated on November 18, 2018 , 637 views

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.

Ready to Invest?
Talk to our investment specialist
Disclaimer:
By submitting this form I authorize Fincash.com to call/SMS/email me about its products and I accept the terms of Privacy Policy and Terms & Conditions.

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.

6 Best Liquid Funds India 2018 - 2019

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2017 (%)
Axis Liquid Fund Growth ₹2,011.29
↑ 0.42
₹20,5361.93.87.37.37.96.7
Reliance Liquid Fund  Growth ₹4,421
↑ 0.94
₹46,3191.93.87.37.37.96.7
Tata Liquid Fund Growth ₹2,855.38
↑ 0.60
₹20,8931.93.77.37.37.96.7
Aditya Birla Sun Life Liquid Fund Growth ₹291.257
↑ 0.06
₹54,1331.83.77.37.37.96.7
ICICI Prudential Liquid Fund Growth ₹268.311
↑ 0.06
₹51,3451.83.77.37.27.96.6
UTI Liquid Cash Plan Growth ₹2,970.57
↑ 0.61
₹37,4781.93.87.37.37.96.7
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 Nov 18
*Above is list of best Liquid funds having AUM/Net Assets above 10,000 Crore and managing funds for 5 or more years.

1. Axis Liquid Fund

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 CAGR/Annualized return of 8% since its launch.  Ranked 21 in Liquid Fund category.  Return for 2017 was 6.7% , 2016 was 7.6% and 2015 was 8.4% .

Below is the key information for Axis Liquid Fund

Axis Liquid Fund
Growth
Launch Date 9 Oct 09
NAV (20 Nov 18) ₹2,011.29 ↑ 0.42   (0.02 %)
Net Assets (Cr) ₹20,536 on 31 Oct 18
Category Debt - Liquid Fund
AMC Axis Asset Management Company Limited
Rating
Risk Low
Expense Ratio 0.14
Sharpe Ratio 16.66
Information Ratio 0
Alpha Ratio 0
Min Investment 500
Exit Load NIL
Yield to Maturity 7.33%
Effective Maturity 30 Days
Modified Duration 27 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 13₹10,000
31 Oct 14₹10,921
31 Oct 15₹11,853
31 Oct 16₹12,777
31 Oct 17₹13,639
31 Oct 18₹14,629

Returns for Axis Liquid Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 Nov 18

DurationReturns
1 Month 0.6%
3 Month 1.9%
6 Month 3.8%
1 Year 7.3%
3 Year 7.3%
5 Year 7.9%
10 Year
15 Year
Since launch 8%
Historical performance (Yearly) on absolute basis
YearReturns
2017 6.7%
2016 7.6%
2015 8.4%
2014 9.1%
2013 9.2%
2012 9.7%
2011 9%
2010 5.6%
2009
2008
Fund Manager information for Axis Liquid Fund
NameSinceTenure
Devang Shah5 Nov 125.99 Yr.
Aditya Pagaria13 Aug 162.22 Yr.

Data below for Axis Liquid Fund as on 31 Oct 18

Asset Allocation
Asset ClassValue
Cash100%
Debt Sector Allocation
SectorValue
Corporate58.62%
Cash Equivalent31.13%
Government10.25%
Credit Quality
RatingValue
AA0.15%
AAA99.85%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
National Bank For Agriculture And Rural Development
Commercial Paper | -
7%₹1,406 Cr28,200
↓ -143,471,800
182 DTB 14122018
Sovereign Bonds | -
4%₹833 Cr84,000,000
↑ 49,000,000
Clearing Corporation Of India Ltd
CBLO | -
4%₹816 Cr
91 DTB 29112018
Sovereign Bonds | -
4%₹766 Cr77,000,000
↑ 500,000
91 DTB 21122018
Sovereign Bonds | -
3%₹585 Cr59,000,000
↑ 59,000,000
Housing Development Finance Corporation Limited
Commercial Paper | -
2%₹489 Cr9,800
↓ -49,990,200
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED
Commercial Paper | -
2%₹484 Cr9,700
↓ -48,990,300
JSW STEEL LIMITED
Commercial Paper | -
2%₹423 Cr8,500
↓ -44,991,500
SUN PHARMACEUTICAL INDUSTRIES LIMITED
Commercial Paper | -
2%₹408 Cr8,200
↓ -46,991,800
NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT
Commercial Paper | -
2%₹397 Cr8,000
↓ -19,992,000

2. Reliance Liquid Fund 

(Erstwhile Reliance Liquid Fund - Treasury Plan)

The investment objective of the scheme is to generate optimal returns consistent with moderate levels of risk and high liquidity. Accordingly, investments shall predominantly be made in Debt and Money Market Instruments.

Reliance Liquid Fund  is a Debt - Liquid Fund fund was launched on 9 Dec 03. It is a fund with Low risk and has given a CAGR/Annualized return of 7.4% since its launch.  Ranked 11 in Liquid Fund category.  Return for 2017 was 6.7% , 2016 was 7.7% and 2015 was 8.3% .

Below is the key information for Reliance Liquid Fund 

Reliance Liquid Fund 
Growth
Launch Date 9 Dec 03
NAV (20 Nov 18) ₹4,421 ↑ 0.94   (0.02 %)
Net Assets (Cr) ₹46,319 on 31 Oct 18
Category Debt - Liquid Fund
AMC Reliance Nippon Life Asset Management Ltd.
Rating
Risk Low
Expense Ratio 0.18
Sharpe Ratio 16.13
Information Ratio 0.31
Alpha Ratio 0.56
Min Investment 100
Exit Load NIL
Yield to Maturity 7.71%
Effective Maturity 1 Month 9 Days
Modified Duration 1 Month 6 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 13₹10,000
31 Oct 14₹10,925
31 Oct 15₹11,853
31 Oct 16₹12,784
31 Oct 17₹13,641
31 Oct 18₹14,625

Returns for Reliance Liquid Fund 

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 Nov 18

DurationReturns
1 Month 0.7%
3 Month 1.9%
6 Month 3.8%
1 Year 7.3%
3 Year 7.3%
5 Year 7.9%
10 Year
15 Year
Since launch 7.4%
Historical performance (Yearly) on absolute basis
YearReturns
2017 6.7%
2016 7.7%
2015 8.3%
2014 9.1%
2013 9.2%
2012 9.7%
2011 8.9%
2010 5.3%
2009 5.5%
2008 9.1%
Fund Manager information for Reliance Liquid Fund 
NameSinceTenure
Anju Chhajer1 Oct 135.09 Yr.
Kinjal Desai25 May 180.44 Yr.

Data below for Reliance Liquid Fund  as on 31 Oct 18

Asset Allocation
Asset ClassValue
Cash100%
Other0%
Debt Sector Allocation
SectorValue
Corporate77.39%
Cash Equivalent13.85%
Government8.76%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Net Current Assets
Net Current Assets | -
4%-₹1,699 Cr
NTPC LIMITED
Commercial Paper | -
3%₹1,474 Cr29,800
↑ 19,800
AXIS BANK LIMITED
Certificate of Deposit | -
3%₹1,378 Cr139,360
↑ 139,360
91 DTB 22112018
Sovereign Bonds | -
3%₹1,282 Cr128,709,600
NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT
Commercial Paper | -
3%₹1,165 Cr23,500
↓ -6,500
Axis Bank Limited
Certificate of Deposit | -
2%₹995 Cr100,000
Reliance Jio Infocomm Limited
Commercial Paper | -
2%₹982 Cr20,000
↑ 20,000
TATA STEEL LIMITED
Commercial Paper | -
2%₹931 Cr18,700
↓ -1,000
National Bank For Agriculture And Rural Development
Commercial Paper | -
2%₹796 Cr16,000
LIC Housing Finance Limited
Commercial Paper | -
2%₹795 Cr16,000

3. Tata Liquid Fund

(Erstwhile TATA Money Market Fund )

To create a highly liquid portfolio of money market instruments so as to provide reasonable returns and high liquidity to the unitholders.

Tata Liquid Fund is a Debt - Liquid Fund fund was launched on 1 Sep 04. It is a fund with Low risk and has given a CAGR/Annualized return of 7.7% since its launch.  Ranked 18 in Liquid Fund category.  Return for 2017 was 6.7% , 2016 was 7.7% and 2015 was 8.4% .

Below is the key information for Tata Liquid Fund

Tata Liquid Fund
Growth
Launch Date 1 Sep 04
NAV (20 Nov 18) ₹2,855.38 ↑ 0.60   (0.02 %)
Net Assets (Cr) ₹20,893 on 31 Oct 18
Category Debt - Liquid Fund
AMC Tata Asset Management Limited
Rating
Risk Low
Expense Ratio 0.21
Sharpe Ratio 16.95
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Exit Load NIL
Yield to Maturity 7.5%
Effective Maturity 30 Days
Modified Duration 30 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 13₹10,000
31 Oct 14₹10,925
31 Oct 15₹11,857
31 Oct 16₹12,783
31 Oct 17₹13,641
31 Oct 18₹14,627

Returns for Tata Liquid Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 Nov 18

DurationReturns
1 Month 0.6%
3 Month 1.9%
6 Month 3.7%
1 Year 7.3%
3 Year 7.3%
5 Year 7.9%
10 Year
15 Year
Since launch 7.7%
Historical performance (Yearly) on absolute basis
YearReturns
2017 6.7%
2016 7.7%
2015 8.4%
2014 9.1%
2013 9.3%
2012 9.8%
2011 9%
2010 5%
2009 5.5%
2008 9.4%
Fund Manager information for Tata Liquid Fund
NameSinceTenure
Amit Somani16 Oct 135.05 Yr.

Data below for Tata Liquid Fund as on 31 Oct 18

Asset Allocation
Asset ClassValue
Cash100%
Debt Sector Allocation
SectorValue
Corporate68.6%
Cash Equivalent20.87%
Government10.54%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Indian Oil Corporation Limited
Commercial Paper | -
5%₹962 Cr19,300
↑ 19,300
91 DTB 03012019
Sovereign Bonds | -
5%₹954 Cr96,500,000
↑ 96,500,000
L&T FINANCE LIMITED
Commercial Paper | -
4%₹891 Cr18,000
↑ 18,000
(C) Cblo
CBLO | -
3%₹600 Cr
Indusind Bank Ltd
Certificate of Deposit | -
3%₹550 Cr
91 DTB 29112018
Sovereign Bonds | -
3%₹532 Cr53,467,000
↑ 53,467,000
Piramal Housing Finance Limited
Commercial Paper | -
2%₹499 Cr10,000
↑ 10,000
Housing Development Finance Corporation Limited
Commercial Paper | -
2%₹497 Cr10,000
↑ 10,000
THE SOUTH INDIAN BANK LTD.
Certificate of Deposit | -
2%₹496 Cr50,000
↑ 50,000
IDFC Bank Limited
Certificate of Deposit | -
2%₹496 Cr50,000
↑ 50,000

4. Aditya Birla Sun Life Liquid Fund

(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 CAGR/Annualized return of 7.6% since its launch.  Ranked 15 in Liquid Fund category.  Return for 2017 was 6.7% , 2016 was 7.7% and 2015 was 8.4% .

Below is the key information for Aditya Birla Sun Life Liquid Fund

Aditya Birla Sun Life Liquid Fund
Growth
Launch Date 30 Mar 04
NAV (20 Nov 18) ₹291.257 ↑ 0.06   (0.02 %)
Net Assets (Cr) ₹54,133 on 31 Oct 18
Category Debt - Liquid Fund
AMC Birla Sun Life Asset Management Co Ltd
Rating
Risk Low
Expense Ratio 0.19
Sharpe Ratio 16.17
Information Ratio 0.32
Alpha Ratio 0.61
Min Investment 5,000
Exit Load NIL
Yield to Maturity 7.5%
Effective Maturity 29 Days
Modified Duration 29 Days

Growth of 10,000 investment over the years.

DateValue
31 Oct 13₹10,000
31 Oct 14₹10,932
31 Oct 15₹11,865
31 Oct 16₹12,802
31 Oct 17₹13,658
31 Oct 18₹14,642

Returns for Aditya Birla Sun Life Liquid Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 Nov 18

DurationReturns
1 Month 0.6%
3 Month 1.8%
6 Month 3.7%
1 Year 7.3%
3 Year 7.3%
5 Year 7.9%
10 Year
15 Year
Since launch 7.6%
Historical performance (Yearly) on absolute basis
YearReturns
2017 6.7%
2016 7.7%
2015 8.4%
2014 9.2%
2013 9.3%
2012 9.7%
2011 9%
2010 5.5%
2009 5.5%
2008 9.3%
Fund Manager information for Aditya Birla Sun Life Liquid Fund
NameSinceTenure
Sunaina Cunha18 Jun 099.38 Yr.
Kaustubh Gupta15 Jul 117.3 Yr.

Data below for Aditya Birla Sun Life Liquid Fund as on 31 Oct 18

Asset Allocation
Asset ClassValue
Cash100%
Debt Sector Allocation
SectorValue
Corporate53.77%
Cash Equivalent36.59%
Government9.64%
Credit Quality
RatingValue
AA0.06%
AAA99.94%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
91 DTB 08112018
Sovereign Bonds | -
3%₹1,828 Cr183,010,400
91 DTB 01112018
Sovereign Bonds | -
3%₹1,516 Cr151,588,600
↓ -5,000,000
AXIS BANK LIMITED
Certificate of Deposit | -
3%₹1,402 Cr141,750
↑ 141,750
Bamnipal Steel Limited
Commercial Paper | -
2%₹1,195 Cr24,000
National Bank For Agriculture And Rural Development
Commercial Paper | -
2%₹1,168 Cr23,500
Reliance Jio Infocomm Limited
Commercial Paper | -
2%₹1,049 Cr21,000
7.50% Indusind Bank Limited (27/11/2018)
Certificate of Deposit | -
2%₹1,000 Cr
Housing Development Finance Corporation Limited
Commercial Paper | -
2%₹998 Cr20,000
National Fertilizers Limited
Commercial Paper | -
2%₹994 Cr20,000
↑ 20,000
182 DTB 27122018
Sovereign Bonds | -
2%₹990 Cr100,000,000
↑ 100,000,000

5. ICICI Prudential Liquid Fund

(Erstwhile ICICI Prudential Liquid Plan)

To provide reasonable returns, commensurate with low risk while providing a high level of liquidity, through investments made primarily in money market and debt securities.

ICICI Prudential Liquid Fund is a Debt - Liquid Fund fund was launched on 17 Nov 05. It is a fund with Low risk and has given a CAGR/Annualized return of 7.9% since its launch.  Ranked 20 in Liquid Fund category.  Return for 2017 was 6.6% , 2016 was 7.7% and 2015 was 8.3% .

Below is the key information for ICICI Prudential Liquid Fund

ICICI Prudential Liquid Fund
Growth
Launch Date 17 Nov 05
NAV (20 Nov 18) ₹268.311 ↑ 0.06   (0.02 %)
Net Assets (Cr) ₹51,345 on 31 Oct 18
Category Debt - Liquid Fund
AMC ICICI Prudential Asset Management Company Limited
Rating
Risk Low
Expense Ratio 0.15
Sharpe Ratio 15.44
Information Ratio 0.08
Alpha Ratio 0.4
Min Investment 500
Exit Load NIL
Yield to Maturity 5.47%
Effective Maturity 1 Day
Modified Duration 1 Day

Growth of 10,000 investment over the years.

DateValue
31 Oct 13₹10,000
31 Oct 14₹10,924
31 Oct 15₹11,853
31 Oct 16₹12,783
31 Oct 17₹13,637
31 Oct 18₹14,614

Returns for ICICI Prudential Liquid Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 Nov 18

DurationReturns
1 Month 0.6%
3 Month 1.8%
6 Month 3.7%
1 Year 7.3%
3 Year 7.2%
5 Year 7.9%
10 Year
15 Year
Since launch 7.9%
Historical performance (Yearly) on absolute basis
YearReturns
2017 6.6%
2016 7.7%
2015 8.3%
2014 9.1%
2013 9.3%
2012 9.7%
2011 8.9%
2010 5.5%
2009 5.6%
2008 9.3%
Fund Manager information for ICICI Prudential Liquid Fund
NameSinceTenure
Rahul Goswami27 Sep 126.1 Yr.
Rohan Maru19 Sep 135.12 Yr.

Data below for ICICI Prudential Liquid Fund as on 31 Oct 18

Asset Allocation
Asset ClassValue
Cash100%
Debt Sector Allocation
SectorValue
Corporate60.05%
Cash Equivalent20.69%
Government19.26%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
59 DCMB 14122018
Sovereign Bonds | -
11%₹5,743 Cr579,041,200
↑ 579,041,200
Net Current Assets
Net Current Assets | -
6%-₹3,327 Cr
RURAL ELECTRIFICATION CORPORATION LIMITED
Commercial Paper | -
5%₹2,487 Cr50,000
Union Bank Of India
Certificate of Deposit | -
4%₹1,998 Cr200,000
National Bank For Agriculture And Rural Development
Commercial Paper | -
4%₹1,987 Cr39,900
NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT
Commercial Paper | -
3%₹1,536 Cr30,800
Housing Development Finance Corporation Limited
Commercial Paper | -
3%₹1,486 Cr30,000
↑ 30,000
Housing Development Finance Corporation Limited
Commercial Paper | -
3%₹1,470 Cr29,400
BAJAJ FINANCE LIMITED
Commercial Paper | -
2%₹1,163 Cr23,500
↑ 23,500
India (Republic of)
Sovereign Bonds | -
2%₹1,144 Cr115,893,100
↑ 115,893,100

6. UTI Liquid Cash Plan

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 CAGR/Annualized return of 7.4% since its launch.  Ranked 32 in Liquid Fund category.  Return for 2017 was 6.7% , 2016 was 7.7% and 2015 was 8.3% .

Below is the key information for UTI Liquid Cash Plan

UTI Liquid Cash Plan
Growth
Launch Date 11 Dec 03
NAV (20 Nov 18) ₹2,970.57 ↑ 0.61   (0.02 %)
Net Assets (Cr) ₹37,478 on 31 Oct 18
Category Debt - Liquid Fund
AMC UTI Asset Management Company Ltd
Rating
Risk Low
Expense Ratio 0.09
Sharpe Ratio 16.17
Information Ratio 0.27
Alpha Ratio 0.6
Min Investment 500
Exit Load NIL
Yield to Maturity 7.6%
Effective Maturity 1 Month 3 Days
Modified Duration

Growth of 10,000 investment over the years.

DateValue
31 Oct 13₹10,000
31 Oct 14₹10,919
31 Oct 15₹11,843
31 Oct 16₹12,768
31 Oct 17₹13,624
31 Oct 18₹14,610

Returns for UTI Liquid Cash Plan

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 20 Nov 18

DurationReturns
1 Month 0.6%
3 Month 1.9%
6 Month 3.8%
1 Year 7.3%
3 Year 7.3%
5 Year 7.9%
10 Year
15 Year
Since launch 7.4%
Historical performance (Yearly) on absolute basis
YearReturns
2017 6.7%
2016 7.7%
2015 8.3%
2014 9.1%
2013 9.1%
2012 9.6%
2011 8.9%
2010 5.4%
2009 5.4%
2008 8.9%
Fund Manager information for UTI Liquid Cash Plan
NameSinceTenure
Amandeep Chopra14 Dec 0611.89 Yr.
Amit Sharma7 Jul 171.32 Yr.

Data below for UTI Liquid Cash Plan as on 31 Oct 18

Asset Allocation
Asset ClassValue
Cash100%
Debt Sector Allocation
SectorValue
Corporate73.3%
Cash Equivalent20.34%
Government6.36%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
91 DTB 29112018
Sovereign Bonds | -
4%₹1,484 Cr14,910,370,000
↓ -50,000,000
182 DTB 27122018
Sovereign Bonds | -
3%₹1,237 Cr12,500,000,000
Power Finance Corporation Ltd.
Commercial Paper | -
3%₹1,054 Cr10,650,000,000
↓ -50,000,000
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED
Commercial Paper | -
2%₹931 Cr9,350,000,000
HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED
Commercial Paper | -
2%₹829 Cr8,350,000,000
↑ 2,350,000,000
Indusind Bank Ltd. Std - 90 Days
Certificate of Deposit | -
2%₹750 Cr00
Net Current Assets
Net Current Assets | -
2%-₹746 Cr00
Axis Bank Limited
Certificate of Deposit | -
2%₹686 Cr6,900,000,000
IDFC BANK LIMITED
Certificate of Deposit | -
2%₹566 Cr5,700,000,000
↑ 5,700,000,000
Housing Development Finance Corporation Limited
Commercial Paper | -
1%₹519 Cr5,240,000,000
↑ 300,000,000

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

Features-of-best-liquid-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?

  1. Open Free Investment Account for Lifetime at Fincash.com

  2. Complete your Registration and KYC Process

  3. Upload Documents (PAN, Aadhaar, etc.). And, You are Ready to Invest!

    Get Started

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!

Disclaimer:
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.
How helpful was this page ?
Rated 4.8, based on 8 reviews.
POST A COMMENT