3 ms·
Except an MMF is literally not an investment. It's a form of savings. There's nothing invalid about saving. However whether you want to invest or save has very
by bagacrap 3y ago
Except an MMF is literally not an investment. It's a form of savings.
There's nothing invalid about saving. However whether you want to invest or save has very little to do with "circumstances" and everything to do with personal inclinations and needs.
- ghaff 3y agoI must have missed the day in finance class when they covered the magic return/risk point where it went from being an investment to being just savings.
- bagacrap 3y agoWell, for starters, zero seems like an important point, as in if it's risk free then it's qualitatively different from something that has risk. Even govt bonds have risk because although they have a predefined payout, their market price can fluctuate, sometimes a lot. But MMFs --- negligible risk.
- dragontamer 3y agoThe debate IIRC is somewhere between 3 month bill and and 1 year notes. MMFs that are majorly composed of overnight 1-day loans is so cash-money that when people say 'money' in finance, they usually mean MMFs. ------ Legally speaking, 3 month bills / loans to the government are considered so reliable, that they are considered money-within-a-week in various regulations. Like Savings accounts or Money Market accounts. IE: so many 3 month bills are being traded around, that it acts pretty damn like cash in practice, like real banking regulations. ------- Yes, there is a sliding scale of money/cash into 30 year loans. But financers call even 1 month stuffs basically money, pretty often. A MMF with overnight loans is absolutely more cash-like than anything else.