Holly, NC (PressExposure) August 01, 2010 -- BLR, known for their up to date educational guides on business loan rates, has just released their latest report on finding the best money market funds available.
"A money market fund is an open ended mutual fund that invests in debt securities. The idea is to minimize risk," says John Smith, owner of BLR. "These funds are regulated by the Securities Exchange Commission. Typically the instrument matures in less than thirteen months. Money funds usually invest in paper, short term bonds or re purchase agreements along with other money funds. The first money market fund was founded in ninety seventy one. There are primarily two types of funds the institutional fund and the retail fund. Each functions under the same set of regulations and restrictions."
"Most people are unaware that a money market fund is highly regulated with strict guidelines. They are available through most brokerage houses," says John. "The term 'breaking the buck" comes directly from the tradition of preserving the money market fund with the main goal of the NAV never dropping below the one dollar mark, in the thirty seven year history of the money market funds it has only happened twice where a fund has fallen below a dollar NAV."
"A money market fund should not be confused with a money market account. A money market fun is usually offered by a bank and is a deposit account; a money market fund is more of an investment," says John. The report covers the different things to look for when choosing a money market fund.
"You need to look for certain traits when you are looking for the best money market fund, although you can not predict future performance by past performance it is still a consideration that needs to be looked at," says John. "Compatibility is also important, understanding the prospectus is very important. The prospectus offers an insight to the vision of the fund manager. Keep in mind that the goals of most of these funds are to not lose money, but the best money market fund should also have a yield goal in mind."
The report also covers things that you should be aware of about money market accounts. "There are some very short bond funds that are actually money market funds, but they avoid the restrictions and regulations by not calling the fund a money market fund. These funds are a bit more dangerous," says John.
Access the free report to learn more about money market accounts and to compare bank accounts.