TheFBN Money Market Fund is an open-ended mutual fund that invests in a diverse portfolio of short-term, high-quality money market instruments such as Treasury Bills, Commercial Papers, Bankers Acceptances, and Certificates of Deposit issued by rated Nigerian banks. For more information about this fund, download our funds brochure here. Therefore the functions of capital markets deal in ordinary stocks like debentures of corporations, shares, securities, and bonds of governments. Moreover, the funds, flowing into the capital market come from people having money to invest. The commercial banks, merchant banks, and non-bank financial agents, like: Finance houses; Building societies OldMutual’s money market fund had an average daily investor withdrawal of Sh2.5 million last year, down from Sh2.6 million in 2020. The asset manager’s equity fund — its second-largest *Moody's defines Money Market Funds with an 'Aaa-mf' rating as having a very strong ability to meet the dual objectives of providing liquidity and preserving capital. S&P defines Money Market Funds that have an 'AAAm' rating as demonstrating extremely strong capacity to maintain principal stability and to limit exposure to credit risk. Themoney market is a market for short-term funds, which deals in financial assets whose period of maturity is upto one year. It should be noted that money market does not deal in cash or money as such but simply provides a market for credit instruments such as bills of exchange, promissory notes, commercial paper, treasury bills, etc. Welcometo Capital One Bank. This Account Agreement (herein after referred to as "Agreement"), as may be amended from time to time, constitutes the deposit contract which governs all consumer money market and savings accounts with Capital One Bank. Specifically incorporated by reference into this Agreement, as applicable, are the following OonJN. US says executives defrauded 17,000 investors, many seniorsJudge rejected defense challenge to size of alleged fraudJune 6, 2023, 214 AM UTCA former GPB Capital Holdings managing director charged in a $ billion Ponzi-like scheme that US prosecutors say defrauded thousands of investors is set to plead guilty, according to a person familiar with the Lash, of Naples, Florida, was charged in 2021 along with GPB founder and ex-chief executive officer David Gentile and another executive who the US said used the funds to cover shortfalls and enrich themselves instead of securing returns for their customers. Money market funds are exploding in popularity, but read the fine print before are designed to generate higher yields than bank savings accounts or money market savings accounts.Getty ImagesAccording to the mutual fund industry trade group Investment Company Institute, continued upheavals in the banking industry and the unsettled economy have caused over $ billion to flow into money market funds, or MMFs, in the week ending Wednesday, April 12. This has pushed total money market fund assets to $ trillion, the largest number since the $ trillion pandemic Treasury and government securities MMFs includes investments such as Treasurys Repurchase agreements short-term government securities Certificates of deposit Prime MMFs generally offer an advantage in yield due to their investments in Bank acceptances short-term debt guaranteed by commercial banks Commercial paper unsecured short-term corporate debt MMFs are designed to generate higher yields than bank savings accounts or money market savings accounts. They are most suitable for investors who are seeking to preserve capital, maintain liquidity and earn dividend income. Thus, if an individual wants to invest funds that they know they will need in a short time span, a money market fund could be a viable generate income, but little to no capital appreciation. As a result, MMFs are not considered suitable for long-term investments, but rather as a short-term place to park income generated can be taxable or tax-free depending on the underlying investments. A fund distributes excess earnings from interest as dividends. Investors like MMFs because the fund managers have to make regular payments to the investors, which allows for a steady stream of of Money Market FundsMMFs have been around since the early 1970s. In 1970, Bruce Bent and Henry Brown established the first MMF called the Reserve Primary Fund. Considered a low-risk investment, MMFs gained traction because of their stated goal of maintaining a net asset value, or NAV, of $1 per share. This enabled smaller investors to have a safe place to park cash in the short term, while earning a higher return on their investments than they would with interest-bearing bank the early success of the Reserve Primary Fund, MMFs have been considered safe havens in times of market volatility. Nearly every 401k plan in the nation includes money market funds in the cash category, sometimes as the only cash option the BuckMMFs were started with the premise that the NAV would remain constant at $1 per share. If the NAV went below $1, it was referred to as "breaking the buck."Breaking the buck can occur when Interest rates are too low for the fund to cover operating expenses or losses. Underlying investment values fall. Leverage is used, introducing new capital risk. Too many investors attempt to withdraw funds too quickly. Since inception, the first incident of breaking the buck occurred in 1994 when the Community Bankers Government Money Market Fund was liquidated because of large losses in derivatives. The Investment Company Institute noted that, while this was the very first case of a fund breaking the buck, investors still received 96 cents of every dollar invested. This result generally appeased the public in terms of acceptable additional incidents occurred until 2008, and the very first money market fund was gravely impacted. Investors in the Reserve Primary Fund were rattled to learn that the fund had $785 million in Lehman Brothers commercial paper. While this only represented about of their total holdings, the intense media coverage of Lehman's corporate bankruptcy created conditions causing the fund's NAV to fall to 97 cents per share. As the financial markets melted down, fund managers announced that customers might lose money. This created a significant run on assets, which ultimately caused regulators to force the venerable fund to close its MMFs have grown significantly in size and importance in retirement plans, institutional investors and corporations make up the bulk of investors. This is because the slightly higher rate offered, especially in prime MMF funds, can represent millions of dollars to large investors. Additionally, MMFs tend to have fewer restrictions on withdrawals, adding to their liquidity 2020, short-term interest rates were driven to nearly zero to combat the global COVID-19 pandemic. This caused many MMFs to change strategy in order to avoid closing down, which they accomplished through strategies like waiving fees in order to hold yields above zero. The most controversial action taken was to offer negative yields, where investors actually paid for the privilege of the fund holding their money. Unfortunately, some funds still had to close their and ProtectionsIt is important to understand that money market funds are generally considered to be safe investments, but safe does not mean that they are risk-free. Therefore, understanding the pros and cons of any investment takes on a special importance with money market savings accounts offered by banks, MMFs do not offer Federal Deposit Insurance Corp., or FDIC, protection. Thus investors, while they can typically expect a slightly higher return, are taking an additional risk, since funds are not insured against money market funds are no longer legally required to keep their NAV share prices at or above a dollar. They also do not have to immediately redeem investor shares. Prime MMFs may charge liquidity fees and redemption fees for withdrawals. Additionally, when a money market fund waives fees in order to keep yields high, they are entitled to recoup these losses at a future date. In 2010, the SEC issued a series of new rules to provide more stability and resilience to managing risks. In 2016, the SEC allowed the NAV to float, meaning that it was allowed to go both above and below $1 per share. This gave funds more latitude to deal with adverse conditions without generating a run on funds. However, retail and government MMFs are still required to maintain the $1 per share NAV standard. The SEC continues to weigh additional provisions that would require, among many proposals, that stable NAV funds could convert to a floating NAV if future market conditions warranted it to avoid negative fund GrowthMoney market funds will continue to be in the news, both due to their popularity in the current market environment, but also because the Biden administration is actively promoting environmental, social and governance, or ESG, factors in these is a framework of criteria that corporations can use to evaluate their sustainability. While most ESG efforts are focused on long-term measures such as climate change, executive compensation and diversity initiatives, ESG is finding additional space within the short-term horizons embraced by claim that companies with better ESG characteristics correspond to better credit ratings, which can mitigate risk in the underlying MMF investments. Additionally, ESG-linked commercial paper is becoming more available, which will create new opportunities for socially minded investors and fund Understanding Is KeyMoney market funds' chief competitive advantage is to offer what is historically considered a short-term haven for liquid assets to combat market volatility and generate steady income. It is possible to lose money in these investments and those losses are not backstopped by FDIC all investors should be sure to read the fine print. Additionally, many people would find the services of a professional financial planner invaluable to avoid emotional investment decisions, especially when the markets are moving quickly in response to global Best Financial Tools for You Investors with a focus on the preservation of capital often seek out fixed-income solutions such as government or low-risk municipal bonds, preferred stocks, traditional bank savings products, or money market mutual funds. Each of these investment vehicles provides a degree of safety from otherwise volatile securities markets in addition to a potential stream of fixed income. Although each strategy has its own merits and drawbacks, a money market fund is a popular choice among risk-averse investors. Read on to find out more about this kind of investment and how you can benefit from these putting your money into this product. Key Takeaways Money market funds invest in highly liquid securities like cash, cash equivalents, and high-rated debt-based funds offer investors liquidity because they're invested in securities with short-term maturities—usually 13 months or they only invest in highly rated securities, money market funds offer a high degree of market funds also offer investors higher yields than traditional savings accounts. What Is a Money Market Fund? A money market fund is a type of mutual fund. It invests in highly liquid vehicles such as cash, cash equivalents, and high-rated debt-based securities. These securities tend to have short-term maturities—usually less than 13 months. Many money market funds hold securities like commercial paper and Treasury bills. Investors purchase units or shares of a money market fund from a mutual fund company or through a broker. Just like other mutual funds, there may be a minimum initial investment amount required to take part in a money market fund. They also come with an expense ratio. This fee is calculated as a total percentage of the fund's asset which covers its administrative and operating expenses. Don't confuse money market funds with money market accounts MMAs. Although they may sound alike, they are different. A money market account is a savings account offered by traditional financial institutions, allowing the account holder to earn interest on the average balance. Because they are intended to act as a savings vehicle, MMAs allow investors limited withdrawals. These accounts are insured by the Federal Deposit Insurance Corporation FDIC, while money market funds are not. Types of Money Market Funds Money market funds are divided into different categories depending on their attributes including their maturities and the classes of securities. For instance, government money market funds invest the majority of their assets in cash and government securities. Treasury funds invest in Treasury bills, bonds, and notes. Another type of money market fund is the tax-exempt fund. These types of funds invest primarily in vehicles that are exempt from federal taxes such as municipal bonds. Benefits of Money Market Funds A money market fund provides investors with an array of benefits that you may not find with other investments. The most common are noted below. Liquidity Money market mutual funds provide investors with liquidity. That's because these funds are invested in securities that mature in short periods of time and can be liquidated for cash. Fund managers invest pooled investor dollars into money market securities including bank certificates of deposit CDs, federal agency notes, high-grade commercial paper, or government treasury issues such as T-bills. Safety Investors who want to park their money in a relatively safe investment may want to consider money market funds. The Securities and Exchange Commission SEC mandates that only securities with the highest credit ratings are available to purchase in money market funds, creating a degree of safety for investors not found in other fixed-income investments. This also helps set them apart from other investments such as stocks which are characterized by a higher degree of volatility. Higher Yields In addition to safety and liquidity, money market funds offer the potential for higher yields than conventional cash equivalents such as savings or money market accounts from a bank or credit union. The objective of a money market fund it to keep its net asset value NAV steadily at $1, resulting in no growth of principal. Despite this, money market funds provide investors slightly higher yields than conventional cash equivalents over time because fund managers can diversify the underlying investments. Although they're considered relatively safe investments, money market funds also come with inherent risks including inflation, credit, and interest rate risks. A Word on Risks Even though they're considered a primarily safe place to put your cash, money market funds do come with their own inherent risks—just like any other investment. A few things investors may want to consider are Inflation Risk This risk occurs when the cash flows from a money market fund drop because of inflation. In other words, inflation cuts down how the money market fund performs. Credit Risk Because they aren't insured by the FDIC like savings accounts and CDs, there's no guarantee that you won't lose your money. Interest Rate Risk This is the risk associated with fluctuating interest rates. Yields share an inverse relationship with interest rates, so when interest rates rise, yields drop and vice versa. A money market fund—also known as a money market mutual fund—offers a relatively safe parking spot for your money. They are popular with investors because they are highly liquid, so the money can fund a new investment what is a money market fund? And how does it work? Let’s take a is a money marketMoney market funds are mutual funds that invest in short-term debt securities such as Treasury bills, cash, and cash-equivalent securities. They offer a low level of risk and high confuse a money market fund with a money market account. Money market funds are regulated by the Securities and Exchange Commission SEC and invest your money in the stock market accounts are a savings account offered by financial institutions such as banks and insured by the Federal Deposit Insurance Corporation FDIC.Just like any other investment, money market funds carry the risk of losing value. However, they are considered a safe way to earn a higher interest than savings accounts or money market to dive into the market? Wealthsimple Trade makes it easy to buy and sell thousands of stocks and ETFs—all commission-free. No jargon, no paperwork. Get started money market fund can be a popular tool for investors to park their cash before buying stocks or after selling them. They are much less volatile than the stock or bond markets, but their low returns make them a bad long-term money market funds workMoney market funds work just like any other mutual fund where investors buy shares. The fund takes the money and buys short-term government or corporate debt such as Treasury bonds, commercial paper, certificates of deposit CDs, and so of mutual fund investmentsCertificates of deposit CDs A federally insured savings vehicle with a fixed interest rate and a short-term date of withdrawalBankers’ Acceptance A short-term commercial bank draft representing a promise of future paymentCommercial paper A short-term corporate promissory note representing a pledge of future Treasury securities Short-term government debt obligationsRepurchase agreements A type of short-term borrowing using government securitiesIncome from money market funds can be taxable or tax-free depending on the type of portfolio. Tax-free portfolios can be exempt from federal and/or state and local market funds have tried to maintain a net asset value NAV of $1 per share. Investors receive the difference between the NAV share price and portfolio earnings in the form of NAV rule ensures that investors get regular payments although they are not guaranteed to be the same each time. There is also no guarantee that the mutual fund can maintain the share the fund fails to maintain the $1 share price called “breaking the buck”, it can be liquidated by regulators. This has only happened twice so far once in 1994 with the Community Bankers Government Money Market fund and once in 2008 with the Reserve Primary Money failures resulted in new rules issued by the SEC to provide more stability and prevent similar issues in the of money market fundsThere are three main types of money market funds prime also known as general purpose, government including Treasury, and tax-exempt also known as municipal. Prime and tax-exempt mutual funds are further divided into retail or of their classification, all money market funds must comply with regulatory requirements concerning the diversification of the fund’s investment, the type of investments it holds and their liquidity and of money market fundsPrime general purpose This type of fund invests in corporate notes, commercial paper, CDs, debt issued by government agencies, and so type of money market fund invests at least percent of total assets in cash, government securities, and repurchase agreements. This can include Treasury securities and repurchase agreements for municipal This type of fund comprises municipal securities exempt from federal and sometimes state income tax. As a result, earnings from tax-exempt funds are also money market funds are targeted toward individual investors, while others aim to attract institutional money. Those targeted toward individuals are known as retail money market funds, while those targeted toward institutions are known as institutional money market funds seek to maintain a stable $1 share value or NAV but may charge certain fees or suspend your ability to sell shares depending on market funds don’t have to maintain a stable $1 share value but can use a floating NAV, which allows for fluctuations. These funds may also charge certain fees and suspend the ability to sell individual and institutional investors can buy government money market funds. They don’t charge fees, suspend your ability to sell shares, and are not subject to a floating and disadvantages of money market fundsThere are both advantages and disadvantages to investing in money market funds. Sometimes, they can be the right choice and offer a way to protect and grow your they have downsides that can increase your risk and your opportunity of money market fundsMoney market funds are one of several options for investors looking to park their cash in the short term. Other options include money market accounts, high-interest savings accounts, and so main reason for putting your money in a money market fund is to find a low-risk but low-return investment. Sometimes, they also offer tax-exempt have several advantages over other investment optionsLow risk Money market funds offer low volatility and therefore low risk. They are a relatively safe investment where you can park your cash fees Money market funds don’t charge entry or exit fees or loads.High liquidity Investments within money market funds are highly liquid so you can get them out within a few business days. Many also allow investors to write returns than bank accounts Most money market funds earn more than high-interest savings accounts. Sometimes, such as with municipal funds, the earnings are also of money market fundsWhile there are advantages to money market funds, investors should also consider the downsides. They can be a good option in certain situations but may not work well in of money market fundsVariable rates Unlike traditional savings accounts, there is no guarantee on the rate of return for money market funds. This means you don’t know how much you will earn from capital appreciation Because of the conservative nature of money market funds, investors don’t get capital appreciation. This is a low-risk but also low-return FDIC-insured Since money market funds are a type of mutual fund, they are not insured by the FDIC. They are a security and thus regulated by the SEC. There is still a risk that you can lose your money without the backing of a government costMoney market funds generally offer low returns over the long term unlike riskier investments such as stocks. Over the long haul, inflation will eat away at your returns. This is why you may be better off with a diversified mix of stocks and bonds offered by ratios Just like other mutual funds, money market funds charge a fee that helps pay the cost of running the fund. It’s called the expense ratio and can reduce your earnings from the fund. Therefore it’s important to check the expense ratio information on the fund’s prospectus before putting your money in to money market fundsThere are several alternatives to money market funds, which may fit your needs better and offer similar yields. There are multiple factors that determine which type of account is the best fit for your current are several alternatives to consider for investing your cash in the short termShort duration bond funds and exchange-traded funds ETFsBond funds and ETFs can be a good alternative to money market funds with a higher potential yield. However, they can be higher risk and come with management fees and ETFs offer lower fees than bond funds and full transparency on what bonds they include in the fund. They can be purchased through a broker and traded on the open market like market accountWhile money market accounts often get confused with money market funds, they are not the same thing. Money market accounts are FDIC-insured up to $250,000 and are offered by traditional financial institutions such as regular savings accounts, they often require a higher minimum balance but offer higher yields. Most times, these types of accounts offer check-writing privileges and other features similar to regular bank savings accountHigh-yield savings accounts offer another alternative to money market funds. Just like money market accounts, they are FDIC insured and can be opened at traditional financial money market accounts, they have a lower minimum balance requirement and offer check writing and debit card privileges in many of deposit CDCertificates of deposit are a type of savings account with a fixed-term length of time such as three months, six months, one year, two years, and so on. In exchange for locking up your money for a fixed term, you will receive a fixed money market and high-yield savings accounts, CDs are also FDIC insured up to $250, longer the term, the higher the interest rate. Sometimes, CDs may pay higher interest rates than money market accounts but may require that you lock your money for a long you need to withdraw your money before the maturity date, you will be charged a to talk to someone about investing? Call us to talk with a real-life human being about your financial situation. Get a free analysis of your investments, debt and savings rate. Work on goal setting and make a plan to improve your finances. Book a free investment consultation Updated August 28, 2019 FILE PHOTO Flags of participating countries are pictured ahead of the China-Arab summit in Riyadh, Saudi Arabia, December 7, 2022. REUTERS/Mohammed BenmansourReutersBy Julie Zhu and Aziz El YaakoubiHONG KONG/RIYADH Reuters - Chinese entrepreneurs and investors are flocking to Riyadh this week to attend a business conference, which will bring together business and government leaders aiming to explore expansion and fundraising opportunities, amid warming diplomatic Arabia will be hosting the 10th Arab-China Business Conference, the first such forum since Chinese President Xi Jinping's 'epoch-making' visit to the Gulf state, which Beijing described as the biggest diplomatic initiative in the Arab gathering on Sunday and Monday will take place two days after Secretary of State Antony Blinken visited Saudi Arabia as Washington works to mend frayed ties with its closest ally in the Middle cooperation between Riyadh and Beijing in security and sensitive high-tech has been a major business conference will draw about 2,000 attendees from Greater China, in what will be one of the region's biggest-yet business delegation to Saudi Arabia, according to one person with direct knowledge of the gathering between the world's second-largest economy and Gulf energy giants comes as economic slowdown and geopolitical tensions have made fundraising and expansion challenging for many Chinese funds and companies."From the perspective of both capital and new market, the Middle East, Saudi Arabia are really good new choices for Chinese companies and investors," said Henry Zhang, president of Hong Kong-based private equity firm Hermitage who will travel to Riyadh and attend the conference for the first time along with a number of portfolio companies, said he hopes the trip can help his investees explore the local market and help himself understand the real demands of Middle Eastern investors for Chinese funds."Since late last year, a large number of Chinese funds have rushed to the Middle East looking for new investors. In light of this, what we have to think about is what the potential investors want and how we can differentiate ourselves."The event also comes as Saudi Arabia, the world's top crude exporter and largest Arab economy, aims to cut oil dependence and modernise the country with new industries under its economic agenda - Vision 2030 while deepening ties with Beijing.'MORE COOPERATION'China is Saudi Arabia's top trading partner globally with bilateral trade worth $ billion in 2021. While economic ties remain anchored by energy interests, bilateral relations have expanded under the latter's infrastructure and technology Mogielnicki, senior resident scholar at the Arab Gulf States Institute in Washington, said one key reason for Saudi-Chinese linkages strengthening is that the Arab country is looking for major growth areas via international partnerships."The calculation here is that there is much to gain from more cooperation with China," he said."Chinese technology firms have read the writing on the wall and see the Saudi Vision 2030 transformation agenda as an invitation for longer-term commercial engagement with Saudi customers."For the upcoming conference, Chinese entrepreneurs in attendance represent a range of industries - from renewable energy and artificial intelligence to biotech, finance and to Edison Gao, China-based group vice president of Saudi conglomerate Ajlan & Brothers, the attitude of Chinese enterprises towards expanding in the Gulf state has also undergone "tremendous changes"."I've never seen Chinese companies being so interested in and committed to the Saudi market," said Gao, who joined Ajlan in 2017 and has since been helping attract Chinese firms to expand locally."Previously, I had to actively pitch Chinese companies to consider Saudi Arabia as their destination of outbound investment and overseas expansion. But it's the other way around recently, I've received many business proposals from them."Reporting by Julie Zhu in Hong Kong, Aziz El Yaakoubi in Riyadh and Rachna Uppal in Dubai; Editing by Sumeet Chatterjee and Michael PerryCopyright 2023 Thomson Reuters.

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