Zurich India Liquidity Savings is a short tern debt plan with a focus on corporate investors. With minimum investment of Rs 1,00,000 investors can participate on a no load basis. While under normal circumstances the fund would mail redemption cheque within three working days, the scheme also offers ECS facility for redemption. Under the dividend option, dividends are declared on a weekly basis.
Zurich India Liquidity Savings is targeted at institutional investors who seek liquidity at a short notice. Short tern debt funds invest in an assortment of debt market instruments, with overweight on money market instruments. While money market instruments carry low risk, debt instruments carry a relatively high risk. The fund has parked a predominant part of its growing corpus in money markets instruments such as Commercial papers, Certificate of deposit and call money instruments. In times of softening of interest rates the fund has invested in corporate instruments. However, when the interest rates were ruling high, the fund shifted its investment in call market to capture the gains of high call rates.
While the fund targets a maturity profile of less than one year, the exact portfolio maturity is not available for comment. However, the portfolio suggests that the fund has maintained an average maturity in line with its stated strategy and thus minimised interest rate risk.
With this strategy the fund has outperformed JP Morgan Treasury Bill index in times of a tightening of rates, while lagging behind it in other times. The fund has posted an annualised return of 9.54% against the index return of 10.02%. Zurich India Liquidity Savings plan been managed as a conservative liquid plan, which offers a returns consistent with a liquid portfolio.