Liquid Funds vs Overnight Funds: Where Should You Park Your Short-Term Money? Quick Summary: Liquid funds and overnight funds are low-risk mutual fund options for short-term parking of surplus money. Overnight funds are ultra-safe, investing in one-day instruments. Liquid funds offer slightly better returns by investing in instruments with up to 91-day maturity. Choosing between the two depends on your safety needs, time horizon, and withdrawal flexibility. Ever left a chunk of cash in your savings account for “just a few weeks,” only to realize it sat there doing… absolutely nothing? Yeah. Been there. That’s where liquid funds and overnight funds can quietly step in and do a better job. Let’s explore what they are, how they work, and when it makes sense to use either. 🧊 What’s a Liquid Fund? Liquid funds are debt mutual funds that invest in very short-term instruments—like treasury bills, certificates of deposit, and commercial papers—with a maturity of up to ...