How safe is Liquid Fund?

Liquid funds are debt funds and a safe way to invest surplus money. The name itself suggest that liquid funds are ready available fund and can be redeemed with one day notice. Liquid funds invest money in debt and money market securities with a maturity of up to 91 days. So there is no chance to get negative returns in liquid funds. As liquid funds don’t invest in equity, so we can say Liquid fund is risk-free.

Other related questions

Are liquid funds safe? Are liquid funds risks free? Can liquid funds give negative returns?