A money market fund is a flexible correlative fund that invests in impermanent debt securities like commercial paper and the US Treasury bills. They strive to constrain exposure to depletion as a result of debts. Money market funds are widely known for being secure as bank deposits yet with a higher productivity provision. They are regulated in the United States under the Investment Company Act of 1940 and are important producers of liquidity to financial go-betweens.
Bruce R. Bent, an American businessman, is the man honored for the invention of the world’s first money market fund known as the Reserve Fund in 1970 together with his partner Mr. Henry Brown. While large-scale money was bought and sold before this invention, Bent and his partner came up with a formal way and developed other methods.
The money market idea crossed Bruce’s mind in August 1969 while evaluating the investment vehicles. He thought of a mutual fund that could facilitate rates of return at no market risk. This was to give investors fast liquidity and safety for their money more than anything else. He later adds that his background is inclusive of experience and knowledge of financial markets which allows him to grab opportunities that push for growth efficiently. Contrary to other financial instruments, money market funds hustle to regulate a constant value 1 dollar per share. Funds can pay the surplus to investors. The securities in which money market may buy stock include the commercial paper, repurchase agreements, and temporal bonds among others.
Background Information about Bruce Bent
Bruce Bent was born and grew up in New York’s Great Neck. He went to St. Aloysius School and attended Great Neck North High School. Before joining St. John’s University, Bent worked at the Great Neck Post Office as a mail clerk and carrier and also served in the Marines. He graduated in 1961 from St. Johns University with a Bachelor in Economics degree.
After completing his studies, Bent began his career at Wall Street as LF Rothschild and Company Inc’s managing partner. He then moved to TIAA-CREF pension firm two years later and met his eventual business partner, Mr. Brown. The two established Brown & Bent firm in 1968, and in 1969, the idea of money market funds was born.
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