ECONOMICS
FINANCIAL MARKETS
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Derivatives market
|
|
|
Money market
|
|
|
Commodities market
|
|
|
Foreign exchange market
|
Detailed explanation-1: -They also invest in government-sponsored enterprises (GSE) securities, such as Freddie Mac and Fannie Mae. Since government-backed paper is “risk-free, ” the funds are considered very safe.
Detailed explanation-2: -With all investments, you run the risk of losing money. Money market funds, however, are widely considered one of the safest, lowest-risk and least volatile investment options.
Detailed explanation-3: -As stated above, money market accounts and funds are often considered to have less risk than their stock and bond counterparts. That is because these types of funds typically invest in low-risk vehicles such as certificates of deposit (CDs), Treasury bills (T-bills) and short-term commercial paper.
Detailed explanation-4: -Because they invest in fixed income securities, money market funds and ultra-short duration funds are subject to three main risks: interest rate risk, liquidity risk and credit risk. Interest rate risk measures the impact of changes in rates on the securities held by money market funds.
Detailed explanation-5: -High-yield savings accounts. Series I savings bonds. Short-term certificates of deposit. Money market funds. Treasury bills, notes, bonds and TIPS. Corporate bonds. Dividend-paying stocks. Preferred stocks. More items