Money Market 2020-02-13 08:00:00

Money Market

The money market trades in short-term debt instruments. It includes two types of participants — commercial and retail. Commercial participants (or wholesale participants) such as financial institutions, buy short-term debt for its liquidity and returns.

Retail investors don’t buy debt directly but instead buy money market funds. These funds often have higher rates than savings accounts but are still very liquid, which makes them attractive to investors. Retail investors can also open a money market account, which is similar to a savings account but also with higher rates while still maintaining liquidity, although they do have certain restrictions.

 


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