For the 10-year period ended December 31, 2023, 6 of 6 Vanguard money market funds outperformed their Lipper peer-group average. Results will vary for other time periods. Only mutual funds with a minimum 10-year history were included in the comparison. Source: Lipper, a Thomson Reuters Company.The competitive performance data shown represent past performance, which is not a guarantee of future results.View fund performance
††Vanguard average expense ratio for money market funds: 0.11%. Industry average expense ratio: 0.25%. All averages are asset-weighted. Industry averages exclude Vanguard. Sources: Vanguard and Morningstar, Inc., as of December 31, 2022.
†††Bank accounts can offer more liquidity, ATM access, and overdraft protection. You should consider all material differences before choosing to invest.
Source for 10x yield comparison to bank savings accounts:FDIC National Rates and Rate Caps. For current Vanguard money market fund yields, see above.
All investing is subject to risk, including the possible loss of the money you invest.
Vanguard Municipal Money Market Fund is only available to retail investors (natural persons). You could lose money by investing in the fund. Although the fund seeks to preserve the value of your investment at $1 per share, it cannot guarantee it will do so. The fund may impose a fee upon the sale of your shares or may temporarily suspend your ability to sell shares if the fund's liquidity falls below required minimums because of market conditions or other factors. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund's sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.
Vanguard Cash Reserves Federal Money Market Fund and Vanguard Federal Money Market Fund: You could lose money by investing in the Fund. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the Fund is not a bank account and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The Fund's sponsor is not required to reimburse the Fund for losses, and you should not expect that the sponsor will provide financial support to the Fund at any time, including during periods of market stress.
For more information about Vanguard mutual funds or Vanguard ETFs, obtain a mutual fund or an ETF prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.
FAQs
Money market funds are useful for short-term goals, such as saving for a vacation, a wedding, or a down payment for a house. In these cases, it may be more important that your savings hold their value over the shorter time period.
What money market is used for short-term funding? ›
The money market refers to trading in very short-term debt investments. At the wholesale level, it involves large-volume trades between institutions and traders. At the retail level, it includes money market mutual funds bought by individual investors and money market accounts opened by bank customers.
What is the return on vmsxx? ›
Total returns
| as of 04/30/2024 | 1 MONTH | YTD as of 05/01/2024 |
|---|
| VMSXX | 0.30% | 1.11% |
| BenchmarkTax-Exempt Money Market Funds Average3 | — | — 2 |
Because the fund's income is based on short-term interest rates—which can fluctuate significantly over short periods—income risk is expected to be high.
Which investment is best for short-term? ›
13 Best Short Term Investment Options in India
| Sno. | Investment | Holding Period |
|---|
| 1 | Savings accounts | NIL |
| 2 | Liquid mutual funds | 1 day to no limit |
| 3 | Short term funds | Best to hold for atleast 1 year |
| 4 | Recurring deposits | 6 months to 10 years |
6 more rowsMar 11, 2024
Many accounts have monthly fees
Another drawback to remember is that while they have high yields, money market accounts can also come with cumbersome fees. Many banks and credit unions will impose monthly fees just for the upkeep of your account.
What is an example of a short term money market? ›
For the short term
Money markets include markets for such instruments as bank accounts, including term certificates of deposit; interbank loans (loans between banks); money market mutual funds; commercial paper; Treasury bills; and securities lending and repurchase agreements (repos).
What is the most popular source of short term fund? ›
The main sources of short-term financing are (1) trade credit, (2) commercial bank loans, (3) commercial paper, a specific type of promissory note, and (4) secured loans.
What are short term funds best used for? ›
Short-term financing is typically used to cover short-term needs like materials purchases, inventory, and cash flow fluctuations.
What are the highest yielding money market funds? ›
Our picks at a glance
| Rank | Fund | Yield |
|---|
| 1 | Vanguard Federal Money Market Fund (VMFXX) | 5.31% |
| 2 | Schwab Value Advantage Money Fund Investor Shares (SWVXX) | 5.28% |
| 3 | PIMCO Government Money Market Fund (AMAXX) | 5.27% |
| 4 | Vanguard Cash Reserves Federal Money Market Fund Admiral Shares (VMRXX) | 5.32% |
3 more rowsMar 18, 2024
Income generated by a money market fund can be either taxable or tax-exempt, depending on the types of securities in which the fund invests.
What is the tax rate for money market funds? ›
Income earned from money market fund interest is taxed as regular income, up to 37% depending on the investor's tax bracket. While some local and state taxes offer breaks on income earned from U.S. Treasury bonds, federal income tax still applies.
What is the 7-day yield on a money market fund? ›
What is the 7-day yield? The 7-Day Yield represents the annualized fund yield based on the average income paid out over the previous seven days assuming interest income is not reinvested and it reflects the effect of all applicable waivers. Absent such waivers, the fund's yield would have been lower.
What is the safest money market fund? ›
7 Best Money Market Funds to Buy for Safety
| Money market fund | Expense ratio | 7-day SEC yield |
|---|
| North Capital Treasury Money Market Fund (NCGXX) | 0% | 5.4% |
| Schwab Municipal Money Fund - Investor Shares (SWTXX) | 0.34% | 3.3% |
| Vanguard Ultra-Short Bond ETF (VUSB) | 0.10% | 5.1%* |
| Global X 1-3 Month T-Bill ETF (CLIP) | 0.07% | 5.2%* |
3 more rowsApr 15, 2024
Seven-Day Yield Example
The Vanguard Federal Money Market Fund (VMFXX) reports the top seven-day yield in the government category as of January 3, 2018. It has a simple seven-day yield of 1.22% and a compound seven-day yield of 1.23%.
Is the money market short-term or long term? ›
The money market is part of the fixed-income market that specializes in short-term debt securities that mature in less than one year. Most money market investments mature in three months or less. These are considered to be cash investments because of their quick maturity dates.
Can a money market account lose money? ›
Since money market accounts are insured by the FDIC or the NCUA, you cannot lose the money you contribute to the account—even in the event of a bank failure. You can, however, be subject to fees and penalties that reduce your earnings.
Are money market funds short-term or long term? ›
Money market funds invest in a portfolio of short-term, highly liquid debt products, such as Treasury bills, commercial paper, bankers' acceptances, and certificates of deposit (CDs).
Can money market funds lose value? ›
However, this only happens very rarely, but because money market funds are not FDIC-insured, meaning that money market funds can lose money.
