How Liquid Is A Mutual Fund? 
Mutual funds can be used for a margin loan - up to 50 % loaned to you in exchange for the entire value of the mutual fund or portfolio . If the mutual fund value drops below 50 % when you max out your margin loan , the loan can be `` called '' by the financial institution . You have about 10 days to make up the difference , pay the margin loan back or give up whatever value of the mutual fund you need to make the loan balance whole . If liquidity is what you need , you might want to get versed in the ways of leveraged cash value whole life insurance . It is much easier to create liquidity in these types of contracts and you do n't have to pay anything back in a structured loan agreement . 