Liquid funds usually invest in securities maturing in up to 91 days. These generally include certificates of deposits, commercial papers, treasury bills and other instruments that mature within a stipulated time period. Similar to overnight funds, liquid funds too are considered low-risk schemes. However, they are considered riskier than overnight funds since they carry an element of interest rate risk and credit risk. Until recently, there was no exit load imposed on liquid funds. However, from October 20, 2019, SEBI introduced graded exit loads. The load is 0.007 per cent on the first day and falls to 0.0045 per cent on the sixth day from the date of investment. From the seventh day onwards there is no exit load. The main purpose behind the introduction of exit loads on investments in liquid funds was to shift the very short-term money to overnight funds. From an expense perspective, liquid funds levy 5 basis points to 97 basis points as expense ratio.