Question

income funds and money market funds information

Answer 1

According to me money market funds and income funds are not very different. In income funds the fund’s objective will be to get a descent income to investors over their investments. They use debt bonds of companies and government, securities and other debt instruments to earn stable returns. Sometimes these bonds are clubbed with other risky investments to stabilize returns and reduce the risk on the portfolio. On the other hand money market funds hunt for short period high earning debt instruments like treasury bills from government. In this case the interest earned on the investment plays a major role in choosing the fund.

Answer 2

The difference between money market funds and income funds is not very sharp and clear but yet one can say that money market funds actually have an objective to invest in areas that have secure returns. It may be in government bonds or any other debt instrument. These funds typically have a very short duration of maturity (as short as 90 days or so). They are used by many investors to safe guard the money from the affect of global financial crisis to some extent. Income funds are again funds that aim to bring specified returns on investment. These funds can be of slightly longer duration and are mainly opt by people who look for a safe mode to invest and earn from money.

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