Top Performing Money Market Funds in September 2025
Money market funds, a low-risk investment option, have been providing current income based on the prevailing level of interest rates since their inception in the early 1970s. These funds offer a safe and liquid alternative for short-term investments, providing relatively stable returns.
Originally designed to offer better yields than typical bank accounts by investing in short-term, high-quality debt instruments, money market funds are now divided into three categories: government, prime, and municipal.
Government funds, such as the Vanguard Federal Money Market Fund (VMFXX) and Invesco Government Money Market Fund (INAXX), invest primarily in securities issued by the U.S. government. The assets of VMFXX are $359.2 billion, while INAXX manages $6.4 billion. Both funds have an expense ratio of 0.11 percent.
Prime funds, like JPMorgan Prime Money Market Fund (VMVXX) and Schwab Value Advantage Money Fund (SWVXX), invest in short-term securities issued by U.S. and foreign entities. VMVXX has assets worth $89.2 billion, and SWVXX manages a massive $244.0 billion. The expense ratio for VMVXX is 0.48 percent, while SWVXX has an expense ratio of 0.34 percent.
Municipal funds, such as Vanguard Municipal Money Market Fund (VMSXX), invest in municipal securities that are exempt from federal income tax. VMSXX has assets worth $17.7 billion, and the expense ratio is 0.11 percent.
Each fund aims to maintain a net asset value (NAV) of $1.00 while providing a high level of current income. For instance, Fidelity Money Market Fund (SPRXX) invests in short-term securities to produce a high level of current income while maintaining stability and a high level of liquidity. SPRXX has assets of $133.5 billion, an expense ratio of 0.42 percent, and a yield of 4.03 percent.
It's essential to consider the yield, expense ratio, type of fund, and other fees when choosing a money market fund. Remember, money market funds are not insured by the Federal Deposit Insurance Corporation (FDIC).
Here's a summary of the key information:
- Government funds: VMFXX (yield: 4.21 percent, assets: $359.2 billion), INAXX (yield: 4.09 percent, assets: $6.4 billion)
- Prime funds: VMVXX (yield: 4.04 percent, assets: $89.2 billion), SWVXX (yield: 4.15 percent, assets: $244.0 billion)
- Municipal funds: VMSXX (yield: 2.77 percent, assets: $17.7 billion)
- Fidelity Money Market Fund (SPRXX): yield: 4.03 percent, assets: $133.5 billion, expense ratio: 0.42 percent
Before investing, ensure you understand the risks involved and consult with a financial advisor if necessary. Happy investing!
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