Money market funds are similar to that of bank deposits; an extremely safe way to invest money while earning a sizable yield. Compared to other financial routes, money market funds are low-risk, low-return investments. This low-risk, low-return route could prove to be enticing to investors who are interested in avoiding loads, which are fees charged for entering or leaving funds other than money market funds. Money market funds may also prove to be attractive to investors due to the prospect of investing in municipal securities, which may be tax exempt on both federal and state levels.
Money market funds were first created by Bruce R. Bent, an American businessman who, along with Henry B.R. Brown, created the Reserve Fund. Bent first began his career working along with LF Rothschild and Company as a managing partner, and would then meet his future partner, Brown, at TIAA-CREF, a pension firm. The creation of money market funds was first entertained by Bent, who wished to create a mutual fund that would offer small, yet sizable, rates of return while being an extremely safe option for investment.
After founding the Reserve Fund, Bent would continue to furnish his financial career, maintaining the position of Vice Chairman and President of Double Rock Corporation, a company dedicated to managing and investing cash in retail markets, broker-dealers, banks and qualified plans. Bent also served Hallmark Investment Series Trust as Senior Vice-President and Co-Chief Executive Officer. On top of his illustrious financial career, Bent also took on a role in politics, running for the Nassau County Elective and receiving an official endorsement from the Conservative party.
Responsible for the creation of the money market fund, Bruce R. Bent is hailed as a financial pioneer who engineered an alternative to investment options such as stocks or bonds. Bent’s ultimate legacy would lie in the more than $200 billion dollars investors have managed to earn as a result of investing in money market funds.
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