Answered: Define Money market fund

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter5: Managing Checking And Savings Accounts

Section5.2: Open Checking And Money Market

Problem 3CC

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Define Money market fund

Definition Definition Financial market that deals in securities or assets that are short-term in nature. The money market is responsible for keeping up the liquidity of the businesses and the organizations. These securities are usually held for a period of 12 months or less and are issued by institutions that require cash or funds for their short-term cash flow requirements. The money market is regulated by the federal government.

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Step 1

Introduction:

Usually a financial market is a place of market on which financial instruments such as bonds, stocks, valuable metals and derivatives are exchanged at less trading costs.

Step 2

Answer:

Money market is nothing but a short term financial market (usually securities having the maturities less than one year) a medium for increasingly liquid debt.

Money market funds are institutional fixed income funds that invest in debt securities with limited maturities and low credit risk. Money market mutual funds are also the investing forms with the lowest volatility.

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