MONEY MARKET MUTUAL FUNDS
A money market mutual fund* is a diversified, short-term fund that seeks to provide its investors with interest income, preservation of capital, and maintenance of liquidity. Three types are offered:
- Money market funds invest in high quality money market instruments such as certificates of deposit, bankers acceptances, and commercial paper
- Tax-exempt funds invest in short-term securities exempt from federal tax
- Treasury/Government funds invest in obligations issued by the federal government and its agencies, and in repurchase agreements backed by those securities
Additional information is found in the prospectus, which should be read and retained for future reference by each customer.
Terms and Structures
- Maturity
The fund has no maturity, but provides daily liquidity, which makes it convenient for corporations with variable cash flow needs
- Issued
Fund shares can be bought and sold on any given market day
- Form
Fund shares are registered in the owner's name and are held at a custodian bank for fund owners
- Quoted
Yield is quoted daily; confirmations are issued when trading activity occurs and a monthly statement is sent to all existing fund shareholders indicating interest paid during the previous month
- Rate Structure
Yields vary according to market conditions and interest rate movements
- Interest
Dividends equal to all the fund’s investment income are declared each business day, and paid or reinvested in the fund on the last calendar day of each month
- Denominations
The minimum initial purchase and additional buy/sell increments vary by fund
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