Why you should invest in money market funds!

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Why You Should Invest in Money Market Funds!
In the wary world of the market, money market
funds are a popular way to invest your money in a
relatively safe way usually for short term. Used
by both individuals and businesses, money market
accounts are used as a short-term cash management
tool. For the most part, money market funds are
designed as a short-
term investment (less than one year) many
accounts mature in 30-90 days. There are some
money market accounts designed to save money that
is not for immediate use, but not for long-term
accounts, such as retirement accounts. Richard
Cayne Meyer can help consult on an account for
your needs.
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Stability
Its important to understand how money market
funds (also known as money market deposit
accounts) are set up before investing in one.
These funds are actually securities that have
been backed to keep the share price at 1 per
share. Its rare that it should dip below that
mark its only happened a handful of times
since the advent of money market funds in the
early 1970s. Richard Cayne mentions one of the
advantages of money market funds is that unlike
other financial institutions, the 1-per-share
price makes it one of the more stable funds to
invest in. Its often considered a safer way to
invest your money than in stocks and bonds that
fluctuate with the market.
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Higher Yields
In many cases, these money market accounts are
preferred over setting up a regular saving
account at your bank because money market
accounts often yield a higher interest rate. Its
certainly dependent on the type of bank and in
some cases, the amount you invest. Money market
funds which Richard Cayne can help consult upon
may offer several options for saving money with
more stability and higher yields.
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4
Liquidity
To refer to a funds or accounts liquidity means
its ability to be bought and sold. Certain kinds
of funds are not easily sold or traded, perhaps
because of the type of account it is, the terms
of the account, or that there may not be many
people who are willing to invest in a certain
type of market. Generally, Richard Cayne explains
money market funds are designed to limit the
exposure to the risks of narrow liquidity.
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5
Very Low Fees
Because fund management is not as complex as it
can be for other types of mutual funds, these
funds can charge lower fees and expenses.
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Daily Valuation
Dividends are credited to your account daily,
which ensures that your earnings are always
up-to-date and available.
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7
Lower Minimum Investments
Money market mutual funds generally offer lower
initial investment minimums than other
investments.
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8
Check Writing
Many money market funds allow you to write checks
against the balance, although there can be limits
on this privilege.
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9
Competitive Interest Rates
During a high-interest-rate environment, money
market mutual funds can offer competitive yields
providing returns higher than bank savings and
money market accounts.
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High Quality, Low Market Risk
Money market investments generally have a high
credit quality, which means that there is little
risk that their issuers will not be able to repay
their debt. Because of this high quality, they
are considered low-risk investments. Money market
mutual funds pool these securities in one
investment vehicle that brings low-risk
opportunities to the everyday investor.
Low Market Risk
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