liquid funds: Basic guide for beginners!
Are Liquid Funds Worth Investing? Should you consider liquid funds as an investment option? Every doubt will be clear.
You probably know that liquid funds are debt instruments with a maturity period of only up to 91 days.
In this blog post, I am going to discuss Liquid Funds and I hope you will know better knowledge about them.
So keep continuing…
Before discussing it let’s know some basic knowledge about liquid funds.
What is Liquid Fund?
A liquid fund is a debt instrument that often looks for a short-term investment plan.
This fund comprises of Comercial Paper, Treasury Bill Certificate of Deposite, etc.
Maturity is only of days with the good return are the major way people are showing interest in it.
Benefit from LF!
Basically, investors benefit from the source of investment and after discussion from their expert, they pick one.
The liquid fund has a couple of benefits that I am to discuss in easy language which doesn’t feel boring.
Good Return
The major benefit of a liquid fund is that it provides a good return to the investor compared to stock fast.
Most people have a saving account in their bank that provides approximately 4% p.a. On the other hand, Fixed Deposite where you have to deposit a certain amount on the monthly basis provides interest up to 7.50%.
Historically, Liquid funds may be provided returns in the range of 7% to 9% within 3 months. However, some of the stocks provide a good return as compares to liquid funds.
But Liquid funds have a different perspective. Stocks may be a long term where liquid funds stand for only 3 months of maturity period.
Exit Load
Well, You want your invested money, then liquid funds facilitate No exit load. Whenever you
As per SEBI guidelines, Investors can withdraw 90% of the money and Rs 50,000, Which is lower.
And the rest 10% will be credited into our account in 2–3 days.
So, the No Exit load will be on the investor’s head.