Safest Fund/MF/Debt Fund to buy to use as collateral instead of using cash!


I wanted to know if is there any way where we can invest in something which is liquid and safe as well to buy and use as collateral for FnO trading so i don’t have to use cash directly and can earn interest on the invested Fund without any lock-in period so whenever required can sell to get the cash back.

I.e. If i use 1Lacs cash it’ll just be in the Trading A/c as it is i trade or don’t trade i’ll not earn anything on it but like Fixed deposit lets us make some bucks is there any way where i can buy some safe funds even 1-2% return is also fine but capital should be kind of safe and can pledge them for collateral?

what are such funds to look at? Thanks.

So far, i found out that LIQUIDBEES are always trading at 1000 per Qty so let’s say if i buy 100 LIQUIDBEES for 1Lac and i pledge them for margin so i get 90,000/- collateral to trade in FnO. let’s say market crashes or goes into bull phase and rises by 10% or crashes by 10%, i still get my same 1Lacs back when i sell all 100 LIQUIDBEES and i keep earning Divined so my capital is 100% safe if i use LIQUIDBEES as Collateral. Is this correct? Also can i carry forward positions in NRML if i use collateral margin from LiquidBees?

@siva @ShubhS9 @nithin

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Good question. @rupeshmandal

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SBI Savings Fund

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safest?? every investment comes with inherent risk… there is nothing which is 100 percent safe… but yeah… liquid etf, liquid and overnight funds are one of the safest instruments… but returns are sub par around 3-4 percent currently…

Would suggest you read this module on Varsity to learn about debt funds:

You can refer to this post, to know how Liquid ETF’s work: Everything you need to know about Liquidbees and Liquid Exchange Traded Funds (ETFs)

You can. Though, you cannot use the collateral margin received for buying options, for that you’ll need cash. You can learn more here.

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