The Money Market is a term that refers the market that is created when banks borrow and lend money to each other or trade in financial instruments such as certificates of deposit (CDs). Because the money market deals with fluid assets, it short to medium term liquidity in the global financial market.

A money market fund is a collection of assets that are tied to the money market and are intended to provide protection of the principle investment with the intent on returning a small dividend in the form of interest for the use of the money.

The money market is considered by many to be a safe way to invest short term assets because they remain solvent, do not have time restrictions as do CDs and they provide a better return on investment than simple passbook savings.