Hi @Quantum_AMC
I have noticed that all your previous posts are monologues. So breaking the ice, let me have a discussion with you.
I went through the latest portfolio of Quantum Liquid Fund (Week 5 - April 2020) and it says 57.48% are in T-Bills.
Now, from the RBI website, I found the latest T-Bills yields have gone south a lot in the last few weeks-
My question to you is - with such low yields and then TER being 0.16%, the actual returns of the fund would go down even further, so much so that it would be lesser than even some Saving account interest rates of few banks.
For e.g.
Kotak Bank at present is giving 4.5% interest on Savings account. Now, let’s consider I keep Rs 5 lakh in Kotak Bank Savings A/c.
Safety:
We know that funds in any bank account are insured up to 5 lakh under DICGC Act. This includes the principal and interest amount in Savings account, current account, FD all put together. So my 5 lakhs in Kotak Bank account in Savings account, it is highly safe and gives returns of 4.5% without any expense.
Liquidity:
Keeping cash in the Savings account is highly liquid.
Returns:
- 4.5% of Savings account fixed returns.
- On top of it, Savings Bank interest up to Rs 10,000 is exempted under section 80TTA of the income tax act which is an additional benefit.
So, maybe Quantum liquid fund is good for only people who have exhausted keeping cash in bank accounts and those who have much more surplus funds available with them which they can’t keep in a bank account anymore.
P.S.
I am no way endorsing Kotak bank or advising anyone to do this or do that. I merely stated this as an example to have a healthy discussion looking from a different point of view.