Introduction:
Liquid mutual funds are a safe and easy way to invest your money for a short time. Positioned within the debt fund category, liquid funds specialise in investing in fixed-income and money-market instruments with a credit rating of AA or higher and mature in 91 days or less. Because of this, they are called "liquid" funds. These aptly named funds make an attractive option if you have a short-term horizon spanning days or weeks.
In 2024, there are lots of different liquid funds to choose from. This guide will talk about some of the best ones you can consider investing in.
Best liquid mutual funds in 2024
1. Aditya Birla Sun Life Liquid Fund Direct-Growth
Aditya Birla Sun Life Liquid Fund Direct-Growth is an open-end mutual fund with a scheme asset size of ₹ 38,638.25 crore. This fund primarily falls under the category of open-end funds. In terms of exit load, there is a minimal charge if redeemed within a short period. If you redeem your investment from the Nippon India Liquid Fund Direct-Growth within one day, you will incur an exit load of 0.0070%. The exit load is slightly reduced to 0.0065% for redemption within two days. Within three days, it decreases further to 0.0060%. If you redeem within four days, the exit load is 0.0055%. Similarly, for redemption within five days, it is 0.0050%, and for six days, it is 0.0045%.
The fund boasts an expense ratio of 0.21%. This growth plan maintains a cash holding of 3.42% while benchmarking its performance against the CRISIL Liquid Debt B-I Index.
2. Nippon India Liquid Fund Direct-Growth
In the Nippon India Liquid Fund Direct-Growth, you can invest in an open-end mutual fund with a scheme asset size of ₹ 25,877.01 crore. If you redeem your investment in the Nippon India Liquid Fund Direct-Growth within one day, there is an exit load of 0.0070%. If you redeem it within two days, the exit load is 0.0065%. For redemption within three days, it is 0.0060%. If you redeem within four days, the exit load is 0.0055%; within five days, it is 0.0050%; and within six days, it is 0.0045%.
With an expense ratio of 0.20%, you can expect a relatively low-cost structure. The plan maintains a cash holding of -9.38% and follows the NIFTY Liquid Index B-I benchmark.
3. IDBI Liquid Fund – Direct-Growth
The IDBI Liquid Fund - Direct-Growth is another liquid mutual fund option in 2024. The fund has an expense ratio of 0.13% and a size of ₹ 502 crore, with Raju Sharma serving as the fund manager. The fund's portfolio includes holdings include Treasury Bills Repurchase (TREPS), Kotak Mahindra Bank, Godrej Industries, Small Industries Development Bank of India (SIDBI), Canara Bank, JK Cements, Hindustan Petroleum Corporation Limited (HPCL), and National Bank for Agriculture and Rural Development (NABARD), among others.
The exit load varies depending on how soon you redeem or switch out your investment. If you do so within one day from the date of allotment, there is an exit load of 0.0065%. Within two days, it decreases to 0.0060%; within three days, it's 0.0055%. The exit load further reduces to 0.0050% if you redeem within four days and to 0.0045% within five days. However, if you redeem or switch out within six days, there is no exit load, and the same applies within seven days from the date of allotment.
4. Mirae Asset Liquid Fund Direct-Growth
The Mirae Asset Liquid Fund Direct Growth, managed by Abhishek Iyer, boasts an expense ratio of 0.12%. In terms of exit load, there is a gradual decline from 0.0070% if redeemed within one day, 0.0065% if redeemed within two days, 0.0060% if redeemed within three days, 0.0055% if redeemed within four days, 0.0050% if redeemed within five days, and 0.0045% if redeemed within six days. This fund's Assets Under Management (AUM) amounts to ₹ 11,105.85 crore. Its portfolio includes holdings such as the Reserve Bank of India (RBI), HDFC Bank, and Punjab National Bank (PNB).
To sum it up
When considering the best liquid funds to invest in for 2024, there are several factors to weigh. You must look for funds with low expenses, efficient management, and a strong track record. You must also consider options that align with your investment goals and risk tolerance. Choosing wisely and staying informed can help you make the most of liquid mutual funds to enhance your financial portfolio this year.
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