A Money market fund, also known as principal stability funds, is a type of mutual fund that is required by law to invest in low-risk securities. These funds have relatively low risks compared to other mutual funds and pay dividends that generally reflect short-term interest rates.

Money market funds generally invest in

• Government securities
• Certificates of deposits
• Commercial paper of companies
• other highly liquid and low-risk securities.

Money market funds are generally the safest and most secure of mutual fund investments.

Published on 10 Apr 2008 | Investing

Tags :certificates of deposits, dividends, government securities, interest rates, money market fund, money market funds, mutual fund investments, mutual funds, risk, term interest

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