What is a money market fund South Africa?
What is a money market fund South Africa?
Money markets are named after wholesale markets where banks lend and borrow large sums of money. Because of this access to the wholesale market, money market funds usually offer a yield (a percentage return on your investment) higher than that offered by the retail banks to individual clients.
What bank has the highest interest rate on money market in South Africa?
African Bank has the best-fixed deposit rate for 2021 offering 10.00% interest rate, followed by Discovery Bank with 8.35% with First National Bank coming third with a 8.00% effective interest rate for 60 months investment.
What is the Absa money market interest rate?
The interest rate on this investment bank account is currently 4.2% for Corporate and Investment Banking (CIB) and Business Banking clients, and 4.5%* per annum for Retail, Private Banking and Wealth customers, which is equivalent or better than what you are currently receiving from your AMMF investment.
What is the rate of return for a money market fund?
Over time, common stocks have returned about 8% to 10% on average, including recessionary periods. By investing in a money market mutual fund, which may often yield just 2% or 3%, the investor may be missing out on an opportunity for a better rate of return.
Is the money market a good investment?
Money market accounts are a good investment if you can maintain a high minimum balance, limit your withdrawal of the funds, and understand that you are not protected against inflation. Even when interest-bearing account rates are low, you can still get better rates than what’s offered as standard to the public.
Should you put your money in a money market account?
A money market account is essentially a hybrid between a checking and savings account. It lets you write a limited number of checks each month and sometimes make debit purchases. And your money will earn a higher interest rate in a money market than it will in a checking or savings account.
Why is Absa closing its money market?
Absa’s stated reason for the closure is that investors have the wrong perception about what the fund actually is. ‘However, the Absa Money Market fund is not a bank account – it is a collective investment schemes product and therefore capital and returns are not guaranteed.
