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Unable to understand logic behind why there is no exit load on liquid fund
Imagine that a fund had a large exit load that declined over several years. If you wanted to sell some or all of your investment in that fund you would face a large fee, unless you held it a long time. You would be hesitant to sell because waiting longer would save you money. That is the exact opposite of a liquid investment.  Therefore the ideal level for a liquid fund is to have zero exit load.