A liquid fund is one of the kinds of money owing finance which spends in money market instruments as well as debt. It is a short term high credit excellence. It aids to spend in numerous instruments such as treasury bills, deposit certificates, commercial papers as well as many others. It has a maturity of up to 91 days. The investors who desire to take the smallest amount of risk then liquid funds are an ideal choice.
It is tremendously admired amongst investors who contain risk-averse. This fund normally gives high returns than reduction accounts. In addition, the returns by liquid funds are fixed deposits and at the same time, it offers a high level of liquidity. In general investors who desire to devote in a short term period then the liquid fund is the accurate choice.
Why invest in the liquid fund?
The liquid fund assists investors to expend in a very short era of instance. One of the chief differences among mutual and liquid funds is only the savings duration. The liquid fund investment duration is very small which ranges from two days to a few weeks. Even it can be one day. Basically, the standard maturity of a liquid fund is less than 97 days.
So this finance will be highly appropriate for investors who searching for low-risk investments for short time duration. The low period of liquid funds aid fund managers in order to accomplish the revival command of investors in an easy technique. There are unrelated liquid funds investments accessible in the market so the shareholder can pick one based on their needs and requirements. Moreover, it is the most excellent option when compared to saving money in a bank account.
What are the top 5 liquid funds to invest in?
Thus the below mentioned are best and top 5 liquid funds to invest:
- HDFC liquid fund
HDFC is one of the types of liquid funds which is more popular in the precedent two years. This fund was launched in October 2000. It is one of the ideal funds for investors who want to invest in the low-risk scheme. It definitely provides superior returns to investors. It is one of the most famous liquid funds in India due to its sturdy portfolio.
- Axis liquid fund
Another type of liquid funds is Axis. In order to offer a high level of liquidity with reasonable returns, the Axis liquid fund is launched. It aids to invest in commercial paper, treasury bills, deposit certificate as well as other money market instruments. It is the ideal and best scheme for investors who want to create regular income for short term duration.
- Kotak Mahindra Liquid fund
This fund was launched in November 2003. It is an excellent fund that has a benchmark for short, medium plus long term. You can invest money for 1, 3 or 5 years.
- Reliance liquid fund
This kind of fund has a great performance track record for the past few years. This scheme has generated a high return of 7.50 percent over the last year. It will be best for investors looking for high returns.
- Tata Liquid fund
If you want to generate a highly liquid portfolio of money market instruments then Tata liquid fund is an ideal option. Moreover, it generates reasonable as well as steady income.
