Money market mutual funds

Money market mutual funds - are mutual funds that specialize in investing exclusively in highly rated bonds of all types (state, municipal, corporate), bank deposits, units of other mutual funds and foreign currency.

Money market mutual funds retain the advantages of bond mutual funds, i.e. a medium level of risk and a fairly high yield. The peculiarity of this type of mutual funds is that unit holders must pay income tax (13%) in addition to other costs (commissions and fees to the management company and the depositary) when redeeming units.

Yield on Money market mutual funds is within 5-7%, which is comparable with the normal rate on a deposit. Thus, most often the unit-holders of such a fund are those who seek a reliable safety of their investments with minimal risks due to the diversification carried out by money market mutual funds.