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Liquidity Needs

A liquid fund is a better option compared to a bank fixed deposits

I have Rs 50,000, which I may need in 6-8 months. Please suggest funds that I can invest in for better than bank deposit returns?
- Vivek Pareek

If you are sure of the tenure of your deposit term, a term-deposit with a bank could be an option to explore. However, if you are unsure of the exact tenure for the deposit; you may consider a liquid fund. Liquid funds invest in debt-and money-market instruments like certificates of deposit (CDs), commercial paper and treasury bills. It is for this reason that these funds are an ideal vehicle for parking funds before a final and long-term investment decision is made and can be handy if money is needed at short notice.



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