I have invested substantial amount of my saving into Reliance ETF Liquid Bees. In the current NBFC crisis situation, can you please help me with the types of risks associated with investment in Liquid Bees.
Also can you please explain on how does Reliance Mutual Fund invest in CBLO & Repo Markets?
Any market linked instrument carries an associated risk with it. Having said that, Liquidbees isn’t too adventurous with it allocation. It mainly invests in Collateralized borrowing and lending obligation (CBLO). CBLOs are fully collateralized so there is no default risk. So, this whole NBFC negativity and IL&FS mess has little to no bearing on Liquidbees.
Check the rating profile of the fund. It only invests in AAA and SOV (Sovereign) rated instruments.