Money market fund can be equated to a mutual fund that is open-ended and invests in debt securities on a short term like commercial paper and the US treasury bills. Money market funds are regarded as safer just like bank deposits but with higher yields. They serve as important liquidity providers to fiscal intermediaries.
What are Money Market Funds?
Money market funds were established with an aim of limiting the exposure to loss caused by liquidity, market and credit risks. A money fund is mainly concerned with buying the highest debt that matures in less than 13 months. In this case, the portfolio ought to keep a 60-day or less weighted average maturity (WAM), and should not invest over 5% in any single issuer. The only notable exceptions are repurchase agreements and government securities. The funds are aimed at maintaining a $1 per share stable value and pay dividends to the investors.
Who should have a Money Market Fund?
A money market fund is mainly set up for investors interested in the preservation of their cash while earning a small profit. Investors looking to make higher yields from their short-term deposits benefit a lot from money market funds. These funds were created with an aim of substituting bank accounts.
About Bruce Bent II
Bruce Bent II is the vice chairman and president of Double Rock Corporation, a top financial technology firm. Double Rock Corporation offers the most innovative services in cash management, bank, dealer, retail and qualified plan markets. Bruce Bent II is the senior executive of Landing Rock Group LLC, LIDs Capital LLC and the Island Intellectual Property LLC. They are all fully owned subsidiary affiliates and companies of Double Rock Corporation.
Bent is a leading pioneer of the retirement services and cash management businesses. His huge entrepreneurial drive and vision have acted as the catalysts for the development of some of the most relevant and influential technologies and products present in the financial services trade. Bent II holds a number of patents and his innovative processes serve as the foundation of every company under Double Rock Corporation, which are considered to be the standard in their different markets. He has spent his entire career at the company. Bent II holds a Bachelor of Science in Philosophy from the Northeastern University.
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