Government money market mutual funds inc🥃lude funds that only invest in the following assets:

• U.S. Treasury securities
• Repurchase agreements collateralized by U.S. Treasury securities
• Other types of government securities

Government money market funds attract conservative investors who gravitate to stable, highly liquid vehicles that carry minimal credit risk. Consequently, nearly all mutual fund providers offer some version of🌌 these funds. The following three well-known examples dominate the investment landscape and have helped popularize this investment category. 

Fidelity Government Money Market Fund (SPAXX) 

Fidelity launched the Fidelity Government Money Market Funꦉd (SPAXX) in 1990, and boasts $267.99 billion in total net assets as of May 2023, making it one of the most widely held funds in this category. Similar to the American Century Capital Preservation Fund, SPAXX strives to usher in high-yield🌞 returns, with high liquidity, and an emphasis on capital preservation.

The fund is typically 100% or more invested in cash or cash equivalents in the form of short-term U.S. government securities or 澳洲幸运5官方开奖结果体彩网:repurchase agreements that are fully collateralized by cash or such securities. Some U.S. government securities are issued by duly authorized governmꩵent agencies but a🎃re not directly issued nor guaranteed by the U.S. Treasury.

In selecting the fund's investments, the fund’s management team focuses on maintaining a stable $1 澳洲幸运5官方开奖结果体彩网:net asset value𝔍 (NAV) share p💞rice. The weighted average maturity of the portfolio holdings is 24 days.

As of January 2025, the fund’s top holdings included the following:

• U.S. Government Repurchase Agreements (46.21%)
• Agency Floating-Rate Securities (20.69%)
• Agency Fixed-Rate Securities (5.55%)
• U.S. Treasury Coupons (3.76%)
• U.S. Treasury Bills (24.52%)

The fund has an annual expense ratio of 0.42% and a dividend yield of 0.15%. Its one-year total return is 4.92%. This fund is well suited for investors who prefer its broad range of investments.

Vanguard Federal Money Market Fund (VMFXX)

Vanguard launched the Vanguard Federal Money Market Fund (VMFXX) in 1981. Total AUM as of May 2023 is $247.8 billion. This fund has the same investment aims of providing 澳洲幸运5官方开奖结果体彩网:capital preservation and current income through investing in high-quality, short-term U.S. government securities. Another Vanguard product is the Vanguard Cash Reserves Federal 🍌Money Market Fund (VMMRX) which is also a highly liquid conservative𒈔 fund.

Vanguard bills this fund as one of the most conservat🌱ive offerings in this category, making it an ideal choice for conservative se♛eking risk avoidance and capital preservation.

As of January 2025, the fund’s top allocation was to Repurchase Agreements at 32.10%, followed by U.S. Government Obligations at 35.6%, and U.S. Treasury Bills at 32.30%. The average maturity of the portfolio holdings was 14 days. The expense ratio for the Vanguard Federal Money Market Fund is 0.11%; the dividend yield is 0.16%, and the one-year total return is 5.23%.

American 🐼Century Capital Preservation Fund (CPFXX)

The American Century Investments Capital Preservation Fund Investor Class (CPFXX) was launched by American Century in 1972, and has over $2.27 billion in total 澳洲幸运5官方开奖结果体彩网:assets under management (AUM), as of May 2023. The fund is prima﷽rily known for maximizing safety and liquidity. The fund aims to achieve the highest possible yield return consistent with its asset mix, which consists of Treasury bills, bonds, and notes. The fund ordinarily invests solely in short-term U.S. Treasury money market securities. The weighted average maturity of its portfolio holdings is 39.57 days.

The gross annual expense ratio for the Capital Preservation Fund was 0.48% as of January 2025. Its one-year total return as of January 2025 was 4.74%. This mutual fund is appropriate for investors whose current investment goals align with those of the strategy and who seek a pure-play government money market fund that invests exclusively in U.S. Treasury securities.

Special Considerations

Money market mutual funds can be perfect vehicles for risk-averse investors. Barring a financial crisis, there is little risk associated with these vehicles. Furthermore, some money market accounts and funds come with withdrawal or check writing features, making them a viable alternative to standard checking and savings accounts for some investors.

Correction—Feb. 6, 2025: This article has been corrected to state that the Capitaꦐl Preservation Fund had a one-yea🐎r return of 4.74% as of January 2025.