Liquidbees vs liquid funds

liquidbees and liquid funds. Both are cash equivalent and secured .
But , liquid funds generate and give more or some times double the returns what the liquidbees give .

Then what is the reason logic why do people traders go for liquidbees? Why liquidbees more popular and having more volume liquidity? as compare to the liquid funds…

Awaiting for the reply…


Liquid bees invest in TREPS or cash market instrument, they are collateralize lending hence the returns are low. The dividend credited in your account is also subjected to a DDT (dividend distribution tax) hence the returns are comparative low.

Liquid Funds on the other hand have good exposure to CP, though the maturity is only 3 months there are interest payment risk and capital return risk. Since liquid funds carry a higher risk the returns are better compared to Liquid ETF.


does the liquidfunds also attract DDT (dividend distribution tax) ?


Depends on the option you are taking.

Growth Fund does not while the dividend declaring ones do …

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Do we have such options in liquidbees also ?

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good question i guess pledging of liquid fund is allowed only since last month.

but very important thing to consider is liquid funds used to give around 7 % returns till few days ago . now its giving daily returns of 0.01 % which would be 3.64 % yearly returns . :frowning:

additional question to @Bhuvan & @siva : am i getting calculation right here ? is any other alternatives for example aditya birla floating rate fund for pledging ?

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Liquid funds does track the RFR … so when the bank rate and the RFR reduces … the liquid fund returns will also reduce…

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i have no idea about any of tht . but it used to follow fixed deposit rate now its chasing saving account rate . :worried: … returns are half within days anything to do with recent SEBI move ?

For generating additional returns on amount required for option selling - Will it not give better return by investing in ICICI prudential overnight fund (or any similar funds, wrote this name because zerodha has mentioned this on Funds transfer page) and pledging it for margin than Liquidbees?

By the past track record one can expect 5.91%, but i think this year the returns might be lower because the overall RFR is low… but still you need to park your capital in safe place the trade off here is the returns…

Risk and Returns go hand in hand…

i believe tht 1 year return is not reflecting current reality.

i was getting consistent daily returns of 0.02 % daily when it was returning near 7.24 % yearly .
now since last 20-25 days its returning 0.01 % daily so yearly return would also come down i guess


What is the difference between the overnight fund and the liquidbees ?

both are same only … l

iquid bees is managed by nippon where as overnight fund is managed by ICICI prudential…

Liquid bees pays DDT and credits the returns to you as units on a monthly basis … so the units received are tax free in the hands of the investor

ICICI overnight fund on the other hand is a growth fund … so you will pay tax at the time of redemption…

if I want to invest 1 lakh ; which side should I go ?
overnight fund or the liquidbees ?
which gives more returns ?
why DDT not applicable on the overnight funds ?
liquidbees are traded in the NSE !
are the overnight funds too ?
pls elaborate all the pros and cons of the BOTH , so that I can take a proper decision .
awaiting …
thk u .

This depends on the time frame you are planning to stay invested in markets…

if your time horizon is greater than 3 years go for the growth option which is overnight fund … as that will be more tax efficient ( indexation benefit will apply)

if you want to invest for lesser than 3 years time frame you can go for Liquid bees…

which gives more returns ? - both invest in the same category so the returns will also be moreorless the same…
why DDT not applicable on the overnight funds ? for growth option DDT is not applicable
liquidbees are traded in the NSE ! - Yes
are the overnight funds too ? - No they are mutual funds… so you have to use coin … T1 is the settlement time


Do Liquidbees also attract brokerage costs of 0.1% per trade?

If that’s true, liquid funds could have another advantage over liquidbees in terms of returns, especially in short term.

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