Liquid Fund A better choice than saving bank account

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In today’s fast paced world, each aspect of our life gives us a wide range of choice to choose from one among the same being the investment area. Financial areas like savings and investment offers us many options to invest our hard earned money unlike earlier days which were highly conservative in nature. Yesteryear’s had very few options to park our personal or business funds, the major ones being the Savings Bank account or Current Account. This was more of a savings, as the very name suggests and could not be looked at as a short term or long term investment at any point of time. Liquidity was considered the main advantage of this option and so return on money invested took the least priority. Today, Liquid Funds is the talk of the day though many among us are yet to understand the concept in a precise manner.

 

What exactly are Liquid Funds?

The finance market is full of different kinds of products that fall into varying risk categories. Investors who have a thirst for risk invest in products that are in turn invested in high risk quarters. The common conservative investor parks his money in low risk products with the major motive being getting back at least the money he invested.

 

Liquid Funds are one such finance products that fall under low risk categories since the duration of investment is low. The short maturity terms and low risk involved in such investment portfolio takes care of various credit factors like the venue of investment, the Management, past credit rating record and the performance of sector involved etc. All this makes investment in Liquid Funds the preferred and profitable option for those who want to park their surplus funds for a specific short duration. In short, Liquid Fund is nothing but one of the key products that the Mutual Fund portfolio offers to prudent investors.

 

Who benefits the maximum from Liquid Funds?

Liquid Funds which are basically short term Debt Funds is that type of Investments made for a period under 91 days. It is a type of Mutual Fund product that involves least risk, more so for Corporate who want high yield for the idle funds they have parked in their Current Account. Investments made in Liquid Funds work out in a profitable manner to Corporate for whom every penny matters when it comes to Return on Investment (ROI). What else can make a prudent businessman happy than his idle money earning reasonable returns for him?

 

Why should I go in for Liquid Funds instead of Savings Bank Account or Current Account?

Investing the money in Liquid Funds offers many advantages over parking the same in a common Savings Bank Account or Current Account. Let us have a detailed look at some such advantages that investment in Liquid Funds offer over other types.

 

  1. Higher yield

Liquid Funds offer higher yield on the money they invest than the other forms of investments can offer to customers. This is made possible through diversification of these funds in safe low risk products available in the money market. At the same time, money invested in Savings Bank Account remains docile yielding lower returns than the ones invested in Liquid Funds.

 

  1. Explore markets

The money you invest in Liquid Funds provides you the access to venture into the wholesale debt aspects prevalent in the money market. The money you invest in Liquid Funds can also float around the Equity market when you feel it is the right time to invest in the same.

 

 

  1. Flexibility factor

Investing in Liquid Funds offers high levels of flexibility which is absent in other types of savings options like Bank Account or Current Account. You can opt for weekly or monthly Dividend payouts as per your comfort and requirement levels.  Even after investing in low risk financial products like growth funds, if you feel it is wise to transfer the same to Equity Funds, you are offered the flexibility to do so at any point of time. Remember, amongst the many financial products in the Mutual Fund platform and out of the same, the flexibility levels investing in Liquid Fund offers is unique.

 

  1. Liquidity for Emergency

Financial needs of businesses vary from one Corporate and another. Businesses are usually dependent on market volatility and so funds may be required in an emergency manner at any point of time. Investing in Liquid Funds, as the very name suggests, helps in a timely manner during emergency situations. Though Liquid Funds appear Greek and Latin to many in the retail market and is considered as a product equivalent to Savings Bank account, the hand in glove manner it helps at times of Emergency is unparalleled.

 

  1. Different and useful

Liquid Funds is a different product that offers novel gamut of advantages to investors. Right from the features involved in this form of investment to the returns it offers to investors, Liquid Funds works out to be one of the best investment options. Liquid Funds caters to the needs of the current business scenarios which are highly market dependant and absolutely volatile in nature. Every Corporate benefits in a safe and steady manner when their idle or surplus funds are parked in Liquid Fund.

 

Understand how investing in Liquid Funds works profitable for you on a comparative scale from your Financial Consultant. Disallow even the smallest chunk of your money lie idle or yield meagre returns. Maximize the return on your investment by pumping in your surplus money in Liquid Fund instead of the other non-yielding investment options. Liquid Fund is not just yet another investment options that have the same low or non-yielding features offered by many financial products in the past. Venture into investing in Liquid Fund one of the best finance products and avail all the goodness it offers to your business or personal needs. As the saying goes, make hay while the sun shines. Happy investing in Liquid Funds one of the key products in the Mutual Fund arena.

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