The money market has been stabilizing since the last economic meltdown in 2008/2009. However, this stability has been on a rather slow ascend due to several economic factors. Dr. Brian Bonar has seen it all when it comes to financial markets especially with his experience in the field of finance. He has worked in several companies as Chief Financial Officer and chairman as well as Chief Executive Officer.
Finance involves different aspects of investing in the money market. There are various ways through which investors can invest in the money market. In essence, markets depend on the value differentiations of currencies in order to make a profit. The trade just like any other business has its low points and risks. However, as the saying goes, the higher the risk the greater the return.
The main aim in financial markets is to put investors’ money into use and to commit one’s finances into yield-producing financial instruments. There are different points of entries in money markets and they are normally in terms of short-term bonds among other low risk securities. However, venturing in money markets requires prudent deliberations. Before an investor thinks about venturing in the money market, it is advisable that he or she consults a professional in the field.
Financial links between investors and the market includes banks and brokerage agencies. Such links are very important in creating and facilitating an investor’s safe entry into the market. They also provide advisory and planning services. An investor is best advised to gather as much information as he or she can get about financial markets in order to avoid losses.
The money market funds are always maintained at a very stable value per share and the value expansion which aims at increasing shareholders wealth is done through accumulation of interests and dividends. In order to understand the risks involved, one has to be well informed of the risks at hand. For instance, it is common knowledge that money market funds offered through brokerage firms are considered to be riskier compared to the bank-offered funds.
Money markets funds authorities saw the risk that the market was exposed to during the 2008/2009 economic crisis. In response to the effects of the meltdown, funds interest rates, credit, and liquidity risks were reduced. This was a bold move to ensure that the market remained strong and resilient to the effects of an economic meltdown in the future.
In a nutshell, money markets are a safe haven for investors to stock up their money. The basic reason for this is the fact that money markets accounts are less risky compared to stock and bonds. Money markets engage in investments on low risk financial instruments such as certificates of deposits, treasury bills as well as short-term commercial papers.