money-market fund: meaning, definition, pronunciation and examples
C2Technical/Financial
Quick answer
What does “money-market fund” mean?
A type of mutual fund that invests only in highly liquid, short-term debt instruments and cash equivalents.
Audio
Pronunciation
Definition
Meaning and Definition
A type of mutual fund that invests only in highly liquid, short-term debt instruments and cash equivalents.
A professionally managed investment fund that aims to provide investors with high liquidity and very low risk by pooling money to purchase securities such as treasury bills, commercial paper, and certificates of deposit.
Dialectal Variation
British vs American Usage
Differences
The term is identical and standard in both varieties. Spelling remains 'money-market fund' with a hyphen. No lexical differences.
Connotations
Identical connotations of safety, liquidity, and low returns compared to other investments.
Frequency
Equally frequent in both financial contexts.
Grammar
How to Use “money-market fund” in a Sentence
[investor/company] + invested + X amount + in + a money-market fundThe + money-market fund + yields + X percentVocabulary
Collocations
Examples
Examples of “money-market fund” in a Sentence
verb
British English
- The treasury function is tasked to money-market fund the excess cash.
- We need to money-market fund our reserves.
American English
- The CFO decided to money-market fund the corporate cash.
- They money-market funded the proceeds from the sale.
adverb
British English
- The assets were invested money-market-fund style.
- He manages the cash money-market-fund cautiously.
American English
- They operate money-market-fund conservatively.
- The capital was placed money-market-fund safely.
adjective
British English
- The money-market-fund yield has been exceptionally low.
- He reviewed the money-market-fund holdings.
American English
- The money-market-fund rates are finally rising.
- She manages a money-market-fund portfolio.
Usage
Meaning in Context
Business
The company keeps its operational cash in a money-market fund for easy access.
Academic
The study compared the risk-adjusted returns of money-market funds against inflation.
Everyday
My savings account has a worse rate than my money-market fund.
Technical
The fund's seven-day yield and weighted average maturity are key metrics for this money-market fund.
Vocabulary
Synonyms of “money-market fund”
Strong
Neutral
Weak
Vocabulary
Antonyms of “money-market fund”
Watch out
Common Mistakes When Using “money-market fund”
- Misspelling as 'moneymarket fund' (one word) or 'money market-fund' (misplaced hyphen).
- Using as a countable noun without an article: 'He put money in money-market fund' (correct: '...in a money-market fund').
- Confusing it with a 'money market account', which is a bank product, not a fund.
FAQ
Frequently Asked Questions
No. While both offer liquidity and safety, a money-market fund is an investment product whose value can fluctuate slightly, whereas a savings account is a bank deposit with FDIC/FS protection and a fixed interest rate.
It is very rare but theoretically possible, known as 'breaking the buck,' where the net asset value falls below $1 per share. They are considered extremely low-risk, not risk-free.
Both individual investors seeking a safe place for short-term cash and large institutions (like corporations and pension funds) for cash management and meeting short-term operational needs.
A money-market fund invests in debt securities with very short maturities (less than 13 months), prioritizing stability. A bond fund invests in longer-term bonds and is subject to greater interest rate risk and price fluctuation.
A type of mutual fund that invests only in highly liquid, short-term debt instruments and cash equivalents.
Money-market fund is usually technical/financial in register.
Money-market fund: in British English it is pronounced /ˈmʌn.i ˌmɑː.kɪt fʌnd/, and in American English it is pronounced /ˈmʌn.i ˌmɑːr.kɪt fʌnd/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “park your money (in a money-market fund)”
Learning
Memory Aids
Mnemonic
Think: MONEY you need soon + MARKET where it sits temporarily + FUND that pools it = A safe place for short-term cash.
Conceptual Metaphor
FINANCIAL SAFETY IS A HARBOUR / CASH IS A LIQUID.
Practice
Quiz
What is the primary characteristic of a money-market fund?