zerodha: Zerodha is innovating liquid ETFs. Will this attract more retail investors?

zerodha: Zerodha is innovating liquid ETFs. Will this attract more retail investors?


Illustration by Sadhana Saxena via AI

Synopsis

Liquid funds, which for long targeted only corporates, have returned 6% in 2023 — the highest in the last eight years. Now, retail investors have figured out that liquid funds/ETFs are among the best tools for diversification as they provide ease of entry and exit, along with the potential for higher returns compared to traditional savings instruments.

Zerodha Mutual Fund has recently launched its Nifty 1D Rate Liquid ETF among two other fund offerings. Mirae Asset has also launched Nifty 1D Rate Liquid ETF just last year. These are extremely short-duration funds with an ideal holding period of one day to a week. The idea is to attract corporates who want to park in their surplus money in short-term low-risk products. So far, retail investors have stayed away from this category as these funds

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Author: Shirley