5 min read I Date: 21 March 2023
Money market funds and fixed deposits are two common options for investors to grow their money. While both options are generally considered safe, there are some differences between the two that may make one more suitable for certain investors.
Here are some reasons why you might consider investing in a money market fund:
- Potential for Higher Returns: Money market funds generally offer higher returns than fixed deposits, however the returns can fluctuate depending on market conditions.
- Liquidity: Money market funds are more liquid than fixed deposits, as you can sell your shares in the fund at any time and receive your money within a few days. With fixed deposits, you may be penalized for early withdrawals.
- Diversification: Money market funds invest in various short-term debt securities, which helps spread risk and reduce volatility. This can be particularly beneficial for investors who want to avoid putting all their eggs in one basket.
On the other hand, here are some reasons why you might choose to save in fixed deposits:
- Guaranteed Returns: With fixed deposits, you know exactly how much you will earn at the end of the period, as the interest rate is fixed at the time of purchase.
- Low Risk: Fixed deposits are generally considered to be a low risk, as the principal amount is guaranteed and the interest rate is fixed.
- No Market Risk: Unlike money market funds, fixed deposits are not subject to market fluctuations, which can be particularly beneficial for risk-averse investors who want to avoid volatility.
Our advice to investors is not put all your eggs in one basket. Identify your financial objectives and learn how to achieve them within your set time frame.
Invest with Principal via GOinvest. It is a goal-based investing platform which allows you to create up to 7 goals. It is simple, convenient, safe, and affordable. By investing with us via this platform, you can:
- Earn projected returns of up to 3.7%* p.a.
- No lock-in period (flexibility to cash out)
- No maximum investment cap
- Safe & secure as the fund is regulated by Securities Commission Malaysia
- Simple and convenient investment access through an eWallet
*The projected gross return rate excludes fees. Projected gross return (excludes fees) by Principal Malaysia for the next 12 months and may vary daily depending on market performance. Investment involves risk. Please read our disclaimer before investing: https://bit.ly/Principal-Disclaimer
Learn more about our offer here: https://www.principal.com.my/offer/goinvest-raya
You are advised to read and understand the relevant Prospectus, Information Memorandum and/or Disclosure Document including any supplemental thereof and the Product Highlight Sheet (if any) before Investing. Among others, you should consider the fees and charges involved. The registration of the relevant Prospectus, Information Memorandum and/or Disclosure Document including any supplemental thereof and the Product Highlight Sheet (if any) with the Securities Commission Malaysia (SC) does not amount to nor indicate that the SC recommends or endorses the funds. A copy of the relevant Prospectus, Information Memorandum and/or Disclosure Document including any supplemental thereof and the Product Highlight Sheet (if any) may be obtained at our offices, distributors or our website at www.principal.com.my. The issuance of any units to which the relevant Prospectus, Information Memorandum and/or Disclosure Document relates will only be made on receipt of an application referred to in and accompanying a copy of the relevant Prospectus, Information Memorandum and/or Disclosure Document. Please be advised that investment in the relevant unit trust funds, wholesale funds and/ or private retirement scheme carry risk. An outline of the various risk involved are described in the relevant Prospectus, Information Memorandum and/or Disclosure Document. As an investor you should make your own risk assessment and seek professional advice, where necessary. Securities Commission Malaysia does not review advertisements produced by Principal.