Liquid funds see outflows at end of each quarter
Jan 01, 06:01

In the last month of each calendar quarter, liquid funds see relatively higher outflows compared to other months. As per data released by Association of Mutual Funds in India, liquid funds have seen monthly net outflows in the range of Rs 44,226 crore to Rs 1,40,731 crore between August 2019 and November 2020. These outflows are primarily attributed to actions of institutional investors, which includes corporates. Since corporates need cash to make advance tax payments on June 15, September 15, December 15, and March 15 of each year, they tend to redeem units. Also many corporates pay-off short term loans and other outstanding dues quarterly. To do so they utilize cash parked in liquid funds.

Liquid fund-redemption mc mini