NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Scheme Related Information
Under SEBI's categorisation of mutual fund schemes, which of the following describes a Liquid Fund?
A Liquid Fund invests in debt and money market securities with residual maturity of up to 91 days, as per SEBI's scheme categorisation. Overnight funds are different because they invest only in securities maturing in one day.
- AInvests in debt and money market securities with maturity of up to 91 daysCorrect
- BInvests in debt securities with maturity of up to 1 year
- CInvests at least 80% in large-cap equity stocks
- DInvests in overnight securities with maturity of 1 day only
Explanation
SEBI's categorisation defines a Liquid Fund as a debt scheme investing in debt and money market securities with maturity of up to 91 days. Overnight funds invest in securities with 1 day maturity, so option 4 describes a different category.
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