money market fund (MMF)

Open ended mutual fund that invests in highly liquid short-term financial instruments (with maturities typically 90 days to less than one year) such as negotiable certificates of deposit (CDs), commercial paper, and treasury bills; and pays money market account (MMA) rates of interest. MMFs differ from other mutual funds in that their market value remains constant at $1 per share, only the interest rate paid by them fluctuates. They also offer check writing privileges, but are not protected under the deposit insurance schemes. Also called money market mutual fund.