A liquidity fund invests in highly liquid, near term instruments such as cash, cash equivalents and short-term debt securities. These funds have a highly stable asset value and all earnings are distributed to investors.
How is my cash balance distributed?
Trade Republic distributes your uninvested cash deposits among escrow partner banks and for higher balances further diversifies it into liquidity funds.
You can see how your cash balance is distributed between escrow partners and liquidity funds directly in the app from the Cash tile by scrolling down to Benefits and tapping Interest > Average balance.
How are my funds protected?
To find out more about how your money is protected, read this article.