money market investing
One of the biggest questions investors face is, what do I do with my cash when I'm in-between investments?. This article seeks to examine two of the most popular choices - certificates of deposits and money markets - and weighs the pros and cons of each. Certificates of deposit (or CDs for short) are debt instruments issued by banks and other financial institutions to investors. In exchange for lending the institution money for a predetermined length of time, the investor is paid a set rate of interest. Maturities on certificates of deposit can range from only a few weeks to several years with the interest rate earned by the investor increasing in proportion to the time his capital is tied up in the investment. Pros: The investor can calculate his expected earnings at the outset of the investment. Certificates of deposited are FDIC insured for up to $100,000 and offer an easy solution for the elderly who desire only to maintain their capital for the remainder of their life. Cons: If the investor opts for a longer maturity and, thus, higher rate of interest, he will lose access to his funds and forgo alternative uses of his capital. Money markets, on the other hand, offer many of the same benefits as certificates of deposit with the added features of a checking account. Technically speaking, a money market is more or less a mutual fund that attempts to keep its share price at a constant $1. Professional money managers will take the funds deposited in the money market and invest them in government t-bills, savings bonds, certificates of deposit, and other safe and conservative financial instruments. This income is then paid out to the owners of the money market. Investors can open a money market account at most financial institutions. They generally receive a checkbook with which they can draw upon funds in the account. Pros: Depositing money in a money market is as easy as depositing cash into a savings or checking account. Cash is immediately available for alternative investments. Cons: Some financial institutions place a limit on the number of checks that can be drawn against the account in any given month. The rate of interest is directly proportional to the investor's level of deposited assets, not to maturity as is the case with certificates of deposit. Hence, money markets are disproportionately beneficial to wealthier investors. Bankrate - Money Market Accounts RatesInvestopedia - Certificate of DepositSaving with Money Market or a CDTake Action TodayHow to Amass the First \$100kWhat is Warren Buffetts full name?Tests of Muni Bond SafetyBill Gates 1994 In
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Money-market funds flock to guarantee program
BusinessWeek -
In case any fund takes a hit from a soured investment, the guarantees are expected to eliminate motivation for investors to hurriedly pull out money -- and ...
Mutual Fund Withdrawals a Record as Investors Flee (Update1)
Cash Is Looking Better As Investment
Money at Work: Protection, but also risk 
PRU - LON:EMG - PHR
UPDATE 1-Banks borrow record $420.2 bln per day from Fed
Reuters -
Lending via the ABCP money market mutual fund liquidity facility eased to $139.48 billion on Wednesday from $152.1 billion on Oct 1. ...
Bailout has yet to ease fears on Wall Street
Fed Tackles Crisis With Sweeping Policy Changes
Fed eyes plan to fund short-term business loans
Flight to quality as money funds rise, stocks dive
guardian.co.uk, UK -
Total US money market mutual fund assets increased by $58.54 billion to $3.458 trillion in the week ended Oct. 8, the Investment Company Institute said on ...
Investors pull $43B out of stock funds
Bay State businesses yet to feel much relief
Boston Globe, United States -
A key question for companies is whether the traditional buyers of short-term debt, money market mutual funds, are willing to buy any investments that could ...
UPDATE 1-US commercial paper market shrinks 4th week-Fed
What is commercial paper, and why does it matter?
Business lending falls again
The Hartford Mutual Funds To Participate In New Money Market Fund ...
MarketWatch -
Although the Fund seeks to preserve the value of your investment as $1.00 per share, it is possible to lose money by investing in the Fund. ...HIG
Volatility won't keep them out
Globe and Mail, Canada -
For instance, Toronto-based Hartford Investments Canada Corp. offers a bonus interest rate on a minimum $10000 investment parked in a special money-market ...
Market Place Insurance Industry Joins Banking Giants on the Hot Seat
New York Times, United States -
But now a wave of losses is moving throughout the insurance industry, caused by the seize-up of the credit markets and declining investment values. ...
Insurers expected to show big 3Q profit declines MET - AIG
Legg downgraded on money market funds
InvestmentNews, NY -
... net asset value money market funds managed by its affiliate, Western Asset Management [Co. of Pasadena, Calif.], and by the continued weak investment ...
Legg Mason shares plunge to 9-year low
Money Fund Worries Prompt Moody's to Downgrade Legg Mason LM - LMI
Stocks Plunge Again; Dow Under 8600
New York Times, United States -
“There is a downward spiral of fear,” said Richard Sparks, senior equities analyst at Schaeffer’s Investment Research. The plunge came in a stomach-churning ...
Europe, US Futures, Asia Shares Slump; Axa, Philips May Drop
Bloomberg -
Asian money-market rates climbed as injections of more than $32 billion by Japan and Australia and a round of global interest-rate cuts failed to unlock ...
