Manage trading capital efficiently with liquid exchange-traded fund

Switching between cash and equity and back becomes seamless

Investor participation in the stock markets is rising. February 2024 alone saw the opening of four million new demat accounts. These investors can streamline the management of their trading capital by using a liquid exchange-traded fund (ETF). One such ETF—DSP S&P BSE Liquid Rate ETF—was launched recently by DSP Mutual Fund (MF).

How do they work?

Investors can allocate funds meant for the stock market to liquid ETFs, which invest in overnight securities. “Liquid ETFs invest in Treasury Bills Repurchase (TREPS) traded on the Clearing Corporation of India platform that has the closest maturity, primarily one business day,” says Vishal