Money market fund

For money market funds are mutual funds that invest exclusively or predominantly in money market instruments and liquid securities with short maturities. These include time deposits, promissory notes and bonds with a maturity of less than 12 months.

Money market funds are primarily used by large investors, such as companies used to short their funds to "park" because they can be returned on each trading day. To reduce the risk of default on individual obligors, is diversified across securities of different issuers.

In the classic money market are exclusively institutional investors, ie banks, insurance companies or the state active. With their shares in money market funds it manages and private investors to engage indirectly in this market.

• Sales charge,
• Administrative costs or
• Custody fees.

In Germany, money market funds were first admitted in 1994.

It must be noted that even money market funds carry both a certain interest rate risk and credit risk of the issuer. If the issuer states, this is comparatively low in general, but never ruled out. In the context of the financial crisis starting in 2007, it was also used until then considered to be stable money market funds to a negative value.