What is a Money Market Mutual Fund?
In a Money Market Mutual Fund, the money is invested high-quality and very short maturity-based "money market instruments/securites". The maturity ranges from overnight to one year. These securities that are invested in are are deemed to be close substitutes of money.
Money market securities/instruments (Treasury bills, Call money, Commercial paper, Certificates of deposit etc.) are issued by governments, financial institutions and large corporations to raise money. The investor that buys these financial instruments/securities effectively acts as a lender who is entitled to interest at the time of repayment/maturity. Money Market Securities are traded in very high denominations. This limits access for the individual investor. The easiest way for us to gain access to the money market is with a Money Market Mutual Fund.