money market funds
Money market funds are investment vehicles that pool money from multiple investors to purchase short-term, low-risk securities, like government bonds and commercial paper. They aim to provide a stable and accessible way to earn a modest return on cash while maintaining liquidity, meaning you can easily withdraw your money. These funds are generally considered safe, as they invest in high-quality debt instruments. While they offer higher returns than traditional savings accounts, the returns are typically lower than those of riskier investments, making them suitable for conservative investors looking to preserve capital.
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Money market funds are a type of investment that pools money from many investors to buy short-term, low-risk financial assets, like government bonds or commercial paper. They aim to provide a stable value, typically around $1 per share, while offering higher yields than traditional savings accounts. Investors can easily access their money, making them a popular choice for parking cash temporarily. However, while they seek to preserve capital, they are not insured like bank deposits. Overall, they're a suitable option for individuals looking for liquidity and a modest return with relatively low risk.