Money word, in plain English ← Back to all terms
Overnight fund
A mutual fund that lends for a single day at a time, the lowest-risk fund category.
Example. Money in an overnight fund is invested in securities that mature the very next day.
An overnight fund holds securities that mature the next day, so it carries almost no interest rate risk and very little credit risk. Returns are correspondingly low. It suits money that needs somewhere safe to sit for a few days rather than money you want to grow.
One money lesson, in your inbox
A short, plain money lesson built from real news. Free. Unsubscribe anytime.
We will never spam you or sell your details.