This makes them a relatively low-risk way to store money while still receiving interest – although there is of course still a risk to your money.Īs well as this, a money market fund is a way to diversify your investment since the fund manager will invest across multiple bonds and other assets. The difference between money market funds and other funds is that most of the time, money market funds invest in short-term debt with low interest rates. They’ll typically target short-term securities, such as treasuries, debt securities, as well as bank and corporate funds, and other assets that pay interest. With money market mutual funds, your money is invested on your behalf by a fund manager. Otherwise known as a “money market mutual fund”, this form of short-term investment sees your money invested in a similar way to a mutual fund.
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