ZERODHAAMC - LIQUIDCASE

About Zerodha Nifty 1D Rate Liquid ETF

• Zerodha Nifty 1D Rate Liquid ETF is an open-ended scheme belonging to Zerodha Fund House and sponsored by Zerodha Broking Limited. It functions as an Exchange Traded Fund (ETF).
• The Bengaluru-registered Zerodha Asset Management Private Limited is the controlling company of the Zerodha Nifty 1D Rate Liquid ETF. Zerodha Trustee Private Limited is the trustee while Apurv Parikh is the fund manager.
• The scheme was launched on January 17, 2024. The ETF is listed on the National Stock Exchange of India (NSE) and BSE.
• Zerodha Nifty 1D Rate Liquid ETF tracks and mirrors the Nifty 1D Rate Index. It aims to ensure every rise and fall of the index is reflected as far as practicable in the fund values.
• The Assets Under Management (AUM) of Zerodha Nifty 1D Rate Liquid ETF stood at ₹1,688.92 crore, as of July 26, 2024. The fund’s Quarterly average Assets Under Management (AUM) stood at ₹1,055.39 crore, as of June 30, 2024.
• As of July 26, 2024, the tracking error of the scheme since its inception was 0.14%.

• The ETF has given returns of more 6% since inception. It has been categorised as a low risk investment instrument.

Investment Objective and Benchmark

• Zerodha Nifty 1D Rate Liquid ETF aims “to provide investment returns that, before expenses, correspond to the returns of the NIFTY 1D Rate Index, subject to tracking error”
• It has been touted as India’s first Liquid ETF providing the scope of Growth NAV (Net Asset Value), according to the fund house.
• The NIFTY 1D Rate Index gives a measure of the level of return generated by lenders in the overnight market. For calculating the index values, it takes into account the overnight rate provided through the Tri-party Repo Dealing System (TREPS) on treasury bills and government securities.
• Zerodha Nifty 1D Rate Liquid ETF invests in securities that are constituents of the Nifty 1D Rate Index.
• The fund puts its money in overnight instruments such as Treasury Bills or Tri-Party Repo on Government Securities, besides Reverse repo and cash and cash equivalents.

Asset Allocation and Portfolio Composition

• The asset allocation of Zerodha Nifty 1D Rate Liquid ETF comprises around 95%-100% in Tri-Party Repo on Government Securities or T-bills, reverse repo instruments and cash, and cash equivalents and 0-5% in Government Securities and/or Treasury bills with a residual maturity extending till 30 days.
• Zerodha Nifty 1D Rate Liquid ETF top holdings are TREPS, RRIs and cash equivalents.
• TREPS/Reverse Repo Instruments- 99.52%
• Cash & Cash Equivalents- 0.48%