The money market fund is a system having an optional finance system that is mutual. One invests in short-term debt securities like US Treasury bills and commercial paper. Money market funds give a high yield and are safe since they involve large established banks. The USA regulates them using the Investment Company Act of 1940. They provide for liquidity in financial intermediary companies.
The aim of the initiative is to reduce the losses incurred after crediting, in the market and also liquidity risks. Securities and Exchange Commission, SEC is the department that regulates them using the 1940 law. The rule number 2a-7 denies one the quality, maturity, and diversity in money that they have invested. Money that is in the fund can buy high-value debts that will mature after approximately 13 months. They use a weighted average maturity, WAM that takes 60 days or less and will not invest more than 5% in issues but just invest in government securities and repurchase agreements.
The Money market fund likes maintaining a relatively constant value of a dollar per share. The funds pay dividends to investors. The securities that are invested are commercial paper, repurchase agreements, bonds and money funds.
Bruce Bent II is an American businessman, entreprenuer and financial expert who has a good grasp on money market funds. Well, he should. Bent II’s father was the founder of the very first money market fund.
In his career, Bruce Bent II has helped so many great companies find innovated cahs-related solutions and qualified plans. He is an expert on finances and retirement plans. He graduated with his bachelor’s from Northeastern University and started working in the finacial industry with his father. Currently he is the president and vice chairman of the board at Double Rock Corporation where he works.