Overnight funds are low-risk, low-return debt funds investing in the debt papers with residual maturity of one day such as tri-party repos (TREPs) and government securities. They are the highly rated securities with minimum credit risk and almost zero interest-rate risk. These funds earn only via interest payments based on prevailing borrowing and overnight lending rates. When interest rates fall and short-term liquidity is abundant, overnight rates decline and vice versa. These funds are efficient cash management tools to park surplus money for the short term. These funds can be a source fund for Systematic Transfer Plan (STP) to invest in the equity-oriented funds.