What determines whether a financial instrument is classified as a money market instrument?
November 18th, 2008 | by admin |Teresa P asked:
What determines whether a financial instrument is classified as a money market instrument?
What determines whether a financial instrument is classified as a money market instrument?
And also …
What determines whether a financial instrument is classified as a capital market instrument?
2 Responses to “What determines whether a financial instrument is classified as a money market instrument?”
By Yardbird on Nov 21, 2008 | Reply
The money market fund or account manager determines what kind of assets they consider worthy. Read the prospectus for the fund or account. In addition, the fund or account manager has some flexibility in how they implement the fund or account guidelines. There may be some federal standards too. Not sure about that.
Buyer Beware!
The “gold standard” for money market funds is Vanguard’s treasury MM fund, which invests entirely in treasury bonds.
By gosh137 on Nov 21, 2008 | Reply
Money market instruments must invest in government or commercial bonds/notes/paper with a due date of 90 days or less.